Since the departure of Barclays from the banking industry in the Caribbean approximately 17 years ago, there has been the withdrawal of the Bank of Nova Scotia and more recently, the sale of the Royal Bank of Canada to a consortium of indigenous Caribbean Banks.
Of the English-speaking islands in the Caribbean region, the only country not affected by the withdrawal of Nova Scotia and Royal Bank of Canada is Barbados.
However, the Antiguan non-resident High Commissioner to Canada has been keeping a close eye on these developments and has warned Caribbean leaders not to make the same mistakes that were made when the banks were first established in the region many years ago and has zeroed in on a matter of correspondent banking relations (CBR’s) that was apparently not fully explained to customers.
It is likely that customers are hearing for the first time that American banks are reluctant to grant CBR’s to Caribbean banks that have assets of less than US$1 billion dollars.
No doubt, Prime Minister Gaston Browne apprised of such a restriction, was adamant that the sale of the Scotiabank in Antigua must be sold to an indigenous banking entity in order to ensure the requisite asset base.
Of course, Prime Minister Browne’s demand has received a fair share of opposition and detractors including leading spokespeople on banking matters.
Now that Sir Ronald Sanders has revealed what was previously a closely guarded secret that seemed fit only for a few privileged ears, I have asked myself what will the “Wild Coot” have to say within the coming weeks?
With such radical transformation of the banking industry across the region, one has to wonder what effect will such events have on local banking in the foreseeable future?
Michael Ray
