Wed | Jul 17, 2019

Antigua gov't maintaining position on sale of Scotiabank

Published:Friday | May 17, 2019 | 11:59 AM

ST JOHN’S, Antigua, CMC – The Antigua and Barbuda government is maintaining its position regarding the sale of Scotiabank on the island, even as it acknowledged being “informed’ of the present situation.

A statement issued after the weekly Cabinet meeting said: “Although the Scotiabank intention is to sell 100 per cent of its assets in nine jurisdictions to a single entity out of Trinidad, Antigua and Barbuda’s Cabinet has insisted that it will not sign a required vesting order unless a similar offer is made first to local banks.”

Last November, the Trinidad-based Republic Financial Holdings Limited (RFHL) announced that it was seeking to acquire Scotiabank operations in several Caribbean countries.

Antigua and Barbuda and Guyana had initially expressed reservations about the proposed acquisition, with St John’s indicating that it would not be issuing a vesting order to facilitate the move.

The RFHL statement said that the banks being acquired are located in Guyana, St Maarten, Anguilla, Antigua and Barbuda, Dominica, Grenada, St Kitts and Nevis, St. Lucia, and St Vincent and the Grenadines.

It said the purchase price is US$123 million, which represents a US$25 million consideration for total shareholding of Scotiabank Anguilla Limited; and a premium of US$98 million over net asset value for operations in the remaining eight countries.

Antigua and Barbuda has said that it wants assurances that local banks will be given priority to purchase Scotiabank’s operations on the island and that local persons’ investments and savings will be protected.

In a letter to the bank’s general manager Suzan Snaggs-Wilson, Prime Minister Browne lamented “that the authorities of the Bank of Nova Scotia would decide to sell its operations in Antigua and Barbuda without any form of consultation with the regulators or the finance minister whose agreement and authority for such a sale are required by law”.

St John’s had requested a meeting with Scotiabank officials to dismiss the matter, but a statement noted that the “Cabinet was informed that the parties interested in the sale and purchase are still holding discussions”.

In April, the Suriname-based Caribbean Community (CARICOM) Competition Commission (CCC) said the intended sale of Scotiabank’s assets in nine Caribbean countries could have anti-competitive effects in at least three CARICOM member states.

“The Commission remains cognisant of the provisions of Article 175 of the RTC (Revised Treaty of Chaguaramas), and at this time reminds national competition authorities and member states of this critical provision.

“The Commission also informs that it shall approach those national competition authorities and sector regulators in affected member states in accordance with Article 176(1), for the conduct of preliminary examinations of proposed transaction between the enterprises,” it said in a statement.