Deposit and Liquid Asset Requirement

(1) Every bank shall maintain an account in its name with the Central Bank a minimum deposit of one hundred thousand dollars on terms and conditions specified by the Central Bank, or such other sum as may from time to time be specified by the Central Bank by thirty days’ prior notice in writing. (2) Every bank shall maintain a minimum aggregate holding of approved liquid assets, which shall be at least twenty-four per centum of its total deposit liabilities, or as prescribed by the 26 (3) For the purpose of this section “approved liquid assets” means assets that are freely and readily convertible into cash without significant loss, free from any charge, lien or encumbrance whatsoever and includes all or any of the following– (a) notes and coins which are legal tender in Belize and in the United States of America and such other foreign notes and coins as the Central Bank may specify in writing; (b) net balances and deposits held with other banks in Belize not exceeding one year to maturity but where such balances are negative they will be subtracted from the approval (c) cheques and other sight drafts drawn on banks and in the course of collection; (d) balances and deposits at call and at short notice not exceeding one year to maturity held with banks and financial institutions abroad and denominated in currencies freely convertible into dollars net of any or all of the following balances due within one year– (i) balances due to banks and financial institutions abroad; (ii) balances due to head office and other branches abroad; (iii) balances due to holding company or parent company or any company that owns the majority of the shares of a bank or financial institution; 27 (e) inland bills of exchange which are financial commercial transactions, which bear the acceptance or confirmation of acceptance of another bank and which are payable in not more than one year from the date on which they were drawn or accepted; (f) treasury bills and other securities issued or guaranteed by the Government of Belize and maturing in not more than one year; and (g) treasury bills and other securities which have been issued or guaranteed by governments abroad, which are marketable in money and capital markets abroad, which mature in not more than one year and which are denominated in currencies freely convertible into dollars. (4) The Central Bank may, by thirty days’ prior notice in writing to a licensee, require any licensee to maintain a minimum aggregate holding of liquid assets, which shall be equivalent to such value as the Central Bank may determine. (5) Any bank which fails to maintain a deposit with the Central Bank as required by sub-section (1) shall be liable to pay, on being called upon by the Central Bank to do so, a sum of one thousand dollars for each day that it fails to maintain such (6) Any bank which during any quarter fails to maintain a minimum aggregate holding of liquid assets in accordance with this section shall be liable to pay, on being called upon in writing to do so by the Central Bank, a sum equivalent to ten per centum of the amount by which its actual aggregate holding of liquid assets has fallen short of its required aggregate holdings, and such charge shall be payable to the Central Bank on such day as may be fixed by the Central Bank. 28 (7) The Central Bank may vary, by thirty days’ prior notice in writing to a licensee, the method to be used in computing the liquid assets requirement specified in sub-section (2).