Wed | Oct 23, 2019

Antigua gov’t takes issue with Scotiabank over sale of local branch

Published:Friday | August 23, 2019 | 9:53 AM
Scotiabank branch in Antigua and Barbuda - CMC photo.

ST JOHN’S, Antigua, CMC – Prime Minister Gaston Browne says “there appears to be miscommunication” between the Trinidad-based Republic Financial Holdings Limited and Scotiabank regarding the company’s interest in pursuing the purchase of the Antigua holdings of Bank of Nova Scotia.

Browne, responding to an August 19 letter sent to him by Brendan G.J. King, Senior Vice-President International Banking of the Bank of Nova Scotia in Canada, reiterated his administration’s position that “our policy was that any sale should be made to an appropriate vehicle comprising substantial local ownership.”

“In good faith, my Government opened the opportunity for Republic Financial to join a local consortium in purchasing the Antigua holdings of BNS.  However, despite my Government’s participation in earnest and open discussions with Republic Financial, by letter dated July 31st, 2019, Mr Nigel Baptiste, President & CEO of Republic Financial, informed my Government as follows: “… we regret to advise that we have decided to no longer pursue the negotiations re: the sale of any portion of the Antigua Branch. We advised BNS of our decision earlier today and will proceed to close on the other branches and banks.”

Browne said that his administration had taken “Republic Financial at its written word” and had since indicated to King in an August 9 letter that his administration “and a consortium of local banks continue to have an interest in the purchase of Scotiabank Antigua.”

“Negotiations for such purchase can begin immediately. This remains our position,” Browne wrote.

But, he said that “despite this clear and unambiguous history, in your letter of August 19, 2019, you state that BNS will “continue to pursue a transaction with Republic Bank for the sale of our operations in Antigua and Barbuda.

“By adhering to this position, BNS displays a blatant disregard for the laws of Antigua and Barbuda and the role accorded to the Government for safeguarding the integrity and sustainability of the banking sector. A similar law exists in Canada and BNS is well aware that it could not sell its holdings in Canada without the expressed permission of the authorities of the Government of Canada.

“Therefore, my Government and – I daresay – the people of Antigua and Barbuda are astounded that BNS insists on ignoring a law in Antigua and Barbuda that it would not dismiss in Canada,” Browne wrote.

Last November, Republic Financial 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.

Browne told the Caribbean Media Corporation in July that he believes the region should consider getting together and purchase Scotiabank operations in the region.

In his letter to the Scotiabank executive in Canada, Browne said that his government “takes careful note” of the final statement of his August 19 letter that “if we (BNS) are unable to consummate the sale to Republic Bank, we will need to re-examine all of our options, including the closure of our operations in Antigua and Barbuda.”

Browne said he wanted to take the opportunity to “express his profound disappointment and amazement that, after more than sixty years of operations in Antigua and Barbuda, in which BNS has repatriated large profits earned on the backs of Antiguans and Barbudans, that BNS would so casually state its intention to close the Antigua holdings because it refuses to sell the operations to an Antiguan and Barbudan entity.

“After sixty years of profits to BNS shareholders and revenues to Canada, the Government and people of Antigua and Barbuda are entitled to feel aggrieved at such contemptuous treatment.”

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