He was desirous of setting up with some partners an entirely new operation as well in Belize. The major area of interest was a Mutual Fund industry and a stock exchange. He also brought up the matter of a bank and a particular type of bank, which is an internet based bank.
Learned some new things. Apparently in the USA there is now a new breed of bank based on the internet. An example he gave was netbank.com out of Louisiana. This bank has no building whatsover. All banking is done electronically, through credit cards and stuff. The bank exists in cyberspace with it's own servers and that sort of thing. But there are no tellers, it is all automatic. Similar I expect to doing trading with the hundreds of firms now acting as brokers on the internet. E-Trade is probably the biggest and I monitor their quotes regularly and have been thinking of opening an account with them. Low cost and your account statement is updated as you trade. So your statement is online. There is password and access protection and so forth. Certainly a new way of doing business.
Anyway Netbank in Louisiana has about 14,000 registered customers and they all do their transactions via the computer at home.
This cybernet outfit wants to do something similar on a world scale, but their main interest is operating a group of Mutual Funds. Cayman apparently has about 2000 licensed mutual funds and a bunch more that are exempt for one reason or another. Several Mutual Funds in Cayman are over a billion dollars in size each.
The questions I was being asked, were about Mutual Fund legislation. I said there were none, but that some was in the making. And if they would send me their legislative requirements, would open the debate in Belize via this forum.
I pointed out the high cost of doing internet hookups through the monopoly in Belize. While they didn't seem to mind paying the current fees for 24 hour internet access, they would prefer an exemption, or license to install their own telephone satellite system for 24 hour service as it would be a world wide customer service and different time zones does not allow for breakdowns in service and stuff from a local communications supplier. Given the problems I pointed out, they seemed to think this was neglible cost for the scope and size of their operation. Or even if they had to go through a local monopoly.
They wanted to be able to service their Mutual Funds and the fees and commissions involved in a $100 million dollars of operating costs, makes it necessary to have their own bank. No problem, I told them. But! They want a different kind of bank and I know this legislation does not exist in Belize. They wanted a copy cat internet bank, like the one in Louisiana that works exclusively off the internet. It would have servers and that sort of thing, but not an open counter, doors and tellers like currently used in Belize.
Oh yes! The CEO did mention that they were financed and prepared to come into Belize and setup a stock exchange completely. But they would require some long term committments. I could not get that part out of him, but pointed out that the temper of the times, would prohibit any monopoly or exclusive concessions. Otherwise I could see no problem in setting up a stock exchange. It was pointed out to me, that a new stock exchange would take more than five years to breakeven, so they would need long term agreements and reliability as the scope they would require is big for world wide Mutual Fund servicing and operations. My vision of a local stock exchange was of a three room office, but they apparently would be needing something in the order of 40 computer desks or more. Different ball game! I also pointed out that the rules in Belize changed every election cycle of five years. Sometimes they change mid-week, just ask various past investors, which makes political reform all the more urgent.
At any rate the offshore industry is looking to take a new turn into offshore Mutual Funds, internet offshore banking, the needs of an expanded telecommunications service and so on. Lots of problems with such growth economics. But this only emphasizes how Belize must change with the times, the education establishment adjust their degrees and courses and legislators start thinking in new terms and requirements for regulatory services.
Belize has seen it's share of would be dreamers, but still such dreamers sometimes bring up real changes that we have to think about in Belize. These are some of them. Whether it comes to pass or not, the Belmopan crowd have to start boning up on new technology and the avenues that it may be used in Belize and how to make such things work.