FOR THE PEOPLE: Mortgage Corp or Workers Bank (CCU)

An Op-Ed by Paladin

In an article published on January 31, 2026, in a local newspaper, it was reported that Premier Hon. Missick received approval to establish the first Mortgage Company in the Turks and Caicos Islands. The company will be initially financed with $20 million from the TCI Government.

This is undeniably a step in the right direction. However, we must ask a more important question: Is it the best step in that direction?

One of the inherent limitations of a Mortgage Corporation lies in its fundamental premise — lending money based on land value. In practical terms, this means a client must already own land of sufficient value, and the institution will typically lend between 50% and 70% of that value.

That raises an immediate concern: what about the citizen who owns no land?

If access to home ownership is the objective, a system that requires property ownership as a starting point may unintentionally exclude many hardworking Turks and Caicos Islanders who are striving to enter the housing market for the first time.

Another concern is capitalization. While $20 million is a meaningful starting figure, it may not be sufficient to meet national demand for housing finance. If the goal is wide access and long-term sustainability, the capital base must be strong enough to support significant lending activity.

How can this be strengthened?

One option is to revise the model to allow:

a. Government partnership with the general public through share offerings

b. Government partnership with a private entity

c. A hybrid model combining public shareholders and private sector participation

Such structures would inject additional capital into the institution while allowing Turks and Caicos Islanders to become stakeholders. This aligns directly with the title of this article: For the People.

Empowerment should take precedence over mere employment. When citizens own a piece of their country’s financial infrastructure, they are not simply customers — they are participants in nation-building. Ownership builds pride, responsibility, and economic resilience.

Before determining which model best serves the country, it is useful to examine what a Mortgage Corporation would look like in practice in the Turks and Caicos Islands, and then compare it to an alternative: a Cooperative Credit Union, sometimes referred to as a Workers Bank.

Structure of a Mortgage Corporation in TCI

A mortgage corporation is a specialized financial institution that focuses primarily on originating, funding, and sometimes servicing home loans. Unlike traditional commercial banks, these institutions generally do not provide checking accounts, savings products, or broad investment services. Their focus is almost exclusively on real estate lending.

In the Turks and Caicos Islands, a mortgage corporation would operate as a regulated financial entity under the supervision of the Financial Services Commission (FSC). These entities may range from commercial bank subsidiaries to private mortgage funds.

Corporate Structure

Mortgage-related businesses typically operate under one of the following structures pursuant to the Companies Ordinance:

• Ordinary (Domestic) Company – Required for entities conducting on-island business, such as lending directly to TCI residents.

• Exempt Company – Commonly used for international investment or holding structures. These entities cannot trade with TCI residents but are often used for offshore mortgage investment vehicles.

• Mortgage Fund (Unit Trust) – Some corporations manage mortgage funds structured as trusts, where the corporation acts as fund manager overseeing subscriptions, valuations, and administration.

  
  

Operational Requirements

To operate in 2026, a mortgage corporation must satisfy several regulatory and structural obligations:

• Licensing – Any entity providing credit or managing investment funds must be licensed and supervised by the FSC.

• Governance – At least one director and one shareholder are required. There is no residency requirement.

• Local Presence – A Registered Agent and Registered Office within TCI are mandatory.

• Company Secretary – Required for compliance, filings, and reporting obligations.

Lending and Security Structure

Mortgage corporations in TCI secure lending through established legal mechanisms:

• Registered Charges – The lender registers a charge against the property title at the Land Registry to secure its interest.

• Debentures – Companies may issue debentures registered with the Companies Registry to establish creditor priority.

• Loan-to-Value Ratios (LTV) – Lending is typically capped at 50% to 75% of property value, with private funds often taking a more conservative approach.

Regulatory Oversight

As of January 2026, financial institutions must comply with strengthened regulatory standards:

• Sanctions Compliance – Adherence to the UK Sanctions List implemented on January 28, 2026.

• AML/KYC Requirements – Maintenance of detailed beneficial ownership information for anti-money laundering compliance.

• Financial Reporting – Regular returns to the FSC to demonstrate stability and risk management practices.

This structure is clear, regulated, and functional. However, its core limitation remains: access to credit depends primarily on existing property ownership.

Cooperative Credit Union (Workers Bank) Structure in TCI

 In contrast, a Cooperative Credit Union operates on a fundamentally different philosophy.

Under the Credit Union Ordinance 2016 and regulation by the FSC, a credit union is a member-owned financial cooperative designed to serve its members rather than external shareholders.

Core Requirements

 According to statutory guidelines:

• Minimum 100 members

• Minimum institutional capital of $100,000

• Statutory reserve equal to institutional capital

• $2,000 application fee

• $5,000 annual license fee

Compared to the capitalization required for a mortgage corporation, the threshold to establish a credit union is significantly lower.

Governance and Ownership

The distinguishing feature of a credit union is ownership.

• Member Ownership – The institution is owned by its members, who hold shares representing their stake.

• Democratic Control – Operates on a “one member, one vote” principle, regardless of deposit size.

• Board of Directors – Elected from within the membership, typically serving voluntarily.

• Common Bond – Membership is generally based on occupation, association, or community connection.

Regulatory Oversight

Credit unions must also comply with regulatory standards:

• Licensing by the FSC before operations commence

• Compliance with Prudential Standards 2020

• AML, risk management, and appointment of a Compliance Officer

• Regular filings under Section 74 of the Ordinance

Additionally, TCI maintains alignment with international best practices through its relationship with the World Council of Credit Unions.

Which Model Benefits the People More?

 In my view, the Cooperative Credit Union model provides broader utility to the average worker.

Unlike a Mortgage Corporation, a credit union can:

• Offer savings accounts

• Provide personal and small business loans

• Extend credit-building opportunities

• Assist members in reaching the deposit threshold for home ownership

A Workers Bank does not require land ownership for participation. It allows individuals to begin building financial strength from wherever they stand.

Most importantly, the institution is owned by its depositors. It is not controlled by a distant government body or private investors whose primary obligation is profit.

For many Turks and Caicos Islanders, confidence in financial institutions — especially those perceived as government-operated — may not be strong. A member-owned structure could restore trust by placing control directly in the hands of citizens.

The Board of Directors would be elected by and accountable to the members. That is a powerful mechanism for transparency and accountability.

Addressing the Expertise Argument

Some may argue that TCI lacks the necessary expertise to establish and manage a strong credit union.

The answer is practical: hire experienced professionals from within the Caribbean.

The Bahamas, for example, has numerous retired and active banking professionals with decades of experience. Offering five-year contracts would allow:

• Institutional setup

• Governance structuring

• Staff training

• Knowledge transfer

After five years, Turks and Caicos Islanders would be fully prepared to manage and operate the institution independently.

This approach combines external expertise with local empowerment.

The Central Question

The issue is not whether a Mortgage Corporation is useful. It may indeed provide important financing options for property owners.

The deeper question is which model better serves the broader population.

If the objective is widespread financial inclusion, economic participation, and national ownership, the Cooperative Credit Union model appears to offer more comprehensive benefits.

The conversation should not simply be about establishing a financial institution.

It should be about building one that is truly — and structurally — for the people.