Two new banking licences have been granted in the last 18 months, after not one was approved in the previous 20 years, the Enterprise Minister has said.

Laurence Skelly was responding to questions in Keys after Douglas South MHK Clare Christian was granted leave to ask an urgent question after about 120 Lloyds Bank staff being made redundant.

Mr Skelly was asked to confirm by Douglas Central MHK Chris Thomas that local labour shortages were not to blame for licences not being taken up and why the attempts to get new banking and other financial services licences were unsuccessful by private sector groups in the last couple of years?

He said: ‘I can confirm that labour has not been an issue in the enquiries that we have received, and those enquiries have been received over a matter of years. I would actually go back to, I think, when the last administration introduced the Alternative Banking Regime and the result of that was that we have two licences that have been issued in the last 18 months. In those particular cases, I can confirm that local labour has been used and continues to be used, so we see potential growth in respect of that. When you think that there have been two licences issued in the last 18 months compared to the last 20 years when there have been no licences, just reduction, that I think demonstrates the fate of where this industry has been going for some time.’

Mrs Christian had asked Mr Skelly whether DfE had been in contact with any financial institutions which had previously considered moving to the island given the Lloyds redundancies. 

He confirmed that it had not, but added: ‘Although the sector has predicted a gradual reduction over time, there are individual groups within banking and more broadly financial and digital services who are growing. The DfE is currently working closely with one international banking group who are continuing to increase their headcount on the island. 

Mrs Christian later asked: ‘As we have got a large pool of highly trained resources right now, could this be a selling point for the Finance Agency to once again approach international banking businesses now? Are there any other incentives you would consider to attract these businesses?’

Mr Skelly responded: ‘Yes, it is a large resource – no doubt about it. The big question will be are they transferable skills. Touching on the digitisation, yet again, clearly there are big opportunities in the digital economy of the Isle of Man. The variety and opportunities there are really quite significant and even through these last 12 months that we have lived through, there has been significant growth that has already occurred in respect of that.’