The Bank of Mauritius was established in September 1967 as the central bank of the country and is governed by the Bank of Mauritius Act 2004, which has replaced the Bank of Mauritius Act 1966 (as amended).
Functions and Responsibilities of the Bank
The functions of the Bank are directed towards the achievement of its mandate. In particular, the Bank is entrusted with the responsibilities to:
- conduct monetary policy and manage the exchange rate of the rupee, taking into account the orderly and balanced economic development of Mauritius;
- regulate and supervise financial institutions under its purview, namely banks, non-bank deposit taking institutions, and money changers and foreign exchange dealers;
- regulate, license and oversee the payment systems, clearing houses and the issuance and quality of payment instruments;
- manage the foreign exchange reserves of Mauritius;
- collect, compile and disseminate on a timely basis monetary and related financial statistics;
- act as banker and adviser on monetary and financial matters to Government;
adopt policies to safeguard the rights and interests of depositors and creditors of financial institutions;
- monitor system-wide factors that have the potential to impact negatively on the financial conditions of financial institutions;
- promote public understanding of the financial system; and
- maintain a Credit Information Bureau
Regulation and Supervision
The Banking Act 2004 is the enabling legislation for all financial institutions falling under the purview of the Bank of Mauritius. The basic objectives behind the Banking Act 2004 are to maintain a sound banking system in Mauritius and protect the interests of depositors and creditors.
The Banking Act 2004 as amended enables the Bank to issue licences to banks wishing to carry on any of the following: banking business, Islamic banking business and private banking. Since May 2015, the Bank can also issue a specialised financial institution licence to a body corporate which has been set up for the purposes of facilitating the economic development of Mauritius.
The Banking Act 2004 incorporates the following aspects relating to financial institutions falling under the ambit of the Bank of Mauritius:
- licensing of banks and other financial institutions;
- capital structure and requirements;
- financial statements, audit and supervision;
- responsibilities of directors and other officers;
- electronic banking;
- administration of financial institutions;
- role of external auditors;
- limitation on operations;
- conservatorship, voluntary and compulsory liquidation of financial institutions;
- establishment of a Deposit Insurance Scheme;
- issuance of guidelines to financial institutions.
Regulation and Supervision
The Bank participates actively in regional fora to foster, inter alia, regulatory and supervisory cooperation and financial stability in Africa. Among others, the Bank is involved at the level of:
- the Financial Stability Board Regional Consultative Group for Sub-Saharan Africa;
- the Southern Africa Development Community (SADC) Committee of Central Bank Governors;
- the Association of African Central Banks (AACB); and
- the Common Market for Eastern and Southern Africa (COMESA) Committee of Governors of Central Banks.
The Bank acts as the settlement bank for the Regional Payment and Settlement System (REPSS) of the COMESA.