As the Bermuda Monetary Authority (BMA) celebrates 50 years in 2019, we take a look back at the last five decades. From providing sound policy advice to pushing Bermuda forward as a reputable place to conduct business, the BMA has had an incredible impact on Bermuda’s financial landscape.
One of the Bermuda Monetary Authority’s (BMA) guiding principles has always been to create a secure and stable financial environment in Bermuda, whilst ensuring that Bermuda remains an attractive domicile to conduct local and international business. Over the past 50 years, the BMA has met the changing needs of the financial services sector on a local and global scale. It would be an understatement to say that the past five decades have been interesting, but one thing has held true: change is constant. A few recurring indicators of the BMA’s stable influence over the past five decades are the Authority’s ability to adapt to ever-changing needs; its steadfast application of exemplary standards and consistent regulation; and the organisation’s perpetual motion which identifies avenues of regulatory best practices that are beneficial for the Bermuda market and elsewhere.
A time of change and independence.
The formation of the Bermuda Monetary Authority on 20 February 1969, by approval of the Bermuda Monetary Authority Act 1969, came about as a result of the preparations for the wind down of the Sterling Area, a group of countries that either pegged their currency to the pound sterling or issued pounds as their own currency. In 1972, the UK Government decided to abolish the Sterling Area altogether. Because of Bermuda’s dependence on the free movement of funds between the island and Great Britain, it became clear that it would be beneficial to make a break completely from sterling. On 31 July 1972, the Bermuda dollar exchange was fixed on par with the United States dollar, which at that time had a fixed value in terms of gold. The Bermuda Monetary Authority Act 1969 had been amended to allow the parity of the Bermuda dollar to be defined not only in terms of sterling, but also ‘of any other national or international currency, or of gold’.