The Eastern Caribbean Monetary Council is considering a proposed amalgamation of the banks in the subregion in order to create more efficiency and stability within the financial system.
There are more than three dozen banks listed across the OECS region where individual countries hold responsibility for licensing banks in their respective territories.
But Governor of the Eastern Caribbean Central Bank (ECCB), Sir Dwight Venner, is describing the situation as "banking overload".
Venner said there exists a strong case for amalgamating banks across the Eastern Caribbean, which has a population of just over half a million.
"Legally, we have 40 banks in the OECS and that is to say that because each country licences banks separately - the Bank of Nova Scotia, for example, which has seven branches in the Eastern Caribbean Currency Union is regarded as seven banks - so we end up with 26 foreign banks and 14 local banks," said Venner.
"For a population of 600,000 based on all the arithmetic these are too many banks," he said.
The Eastern Caribbean Monetary Council has examined the possibility of amalgamating banks across the Currency Union.
The ECCB governor says the amalgamation must be undertaken carefully.
"Banks are not like supermarkets. If so, they could be closed down with impunity. Banks hold the deposits of citizens and, therefore, must be treated differently. There is also the payment system where cheques are exchanged not only within countries but between currencies, and any unravelling of that system could be chaotic so one must proceed in a very measured way and that is what is taking place," he said.
The ECCB acts as a central bank for Antigua & Barbuda, Dominica, St Lucia, St Vincent and the Grenadines, St Kitts-Nevis, Monster, Angela and the British Virgin Islands.