Minister of Foreign Affairs Fred Mitchell lamented over what he described as a shrinkage of the financial sector in the country during his contribution to debate on the Banks and Trust Companies Amendment Regulation Bill in the House of Assembly on Monday.

Given that the Caribbean has been labeled by the international community as a high risk for financial services, Mr. Mitchell said this is a difficult time for the country’s offshore banking industry in particular.

“We have seen a shrinking of the sector in the country and many Bahamians who found themselves making a good living in the sector no longer do so,” he said.

“It appears that every time we turn around, there is a new assault from outside of the country on the financial services sector and its ability to continue to provide the services that it does for people who have wealth that they want to manage.”

In the midst of what he summed up as an international intrusion on the country’s financial sector, Mr. Mitchell maintained that the government is committed to best practices and protecting the integrity of the industry.

“I’ve made the case around the world that there is still reason for privacy and the protection of one’s privacy as it relates to your wealth and The Bahamas offers the ability to have a well regulated jurisdiction without criminal monies for those people who want to protect their privacy and their wealth and at the same time to have it well managed. That is what we continue to offer to the world.”

Prime Minister and Chair of CARICOM Perry Christie recently announced that the heads of governments agreed to establish a committee of finance ministers to work with the Caribbean Association of Banks to develop a plan to deal with the region being ‘unjustly’ labelled as a high-risk area for financial services.

In a summary statement of the closing press conference for the 26th Inter-Sessional Meeting of the Conference of Heads of Government of the Caribbean Community (CARICOM), Mr. Christie emphasised that this issue must be addressed with urgency.

“Because in many cases our indigenous banks cannot provide a high level of reward, correspondent banks are closing their relationships with them because of the claim that the Caribbean is a high-risk area for financial services,” the statement read.

“Unless this situation is addressed with urgency, the indigenous banks in each of our countries will be adversely affected in their operations.”

Back in December, the Royal Bank of Canada (RBC) decided to cut its Caribbean wealth management divisions in The Bahamas, Barbados and the Cayman Islands and several international advisory businesses in North America.

Reports have indicated that internationally some 300 employees will be affected.

Scotia Bank also announced that it would slash as many as 1,500 jobs and shut down at least 120 of its branches around the world including many of them in the Caribbean.