Vincentians urged to invest in local bank
Prime Minister Dr Ralph Gonslaves is urging nationals to purchase shares in the Bank of St Vincent and the Grenadines that on Monday launched an initial public offering (IPO) hoping to raise expansion capital of more than EC$17 million.
The former state-owned bank is offering two million shares at a price of EC$8.64 and Gonsalves told a news conference "it is not a bad investment".
"For the first time, Vincentians would have the opportunity to be a part of the share owning class in a banking institution," Gonsalves said.
In November 2010, the government announced it had sold controlling interest in the financial institution to the East Caribbean Financial Holding Company Limited (ECFH), parent company of the Bank of St Lucia, at a cost of EC$42 million.
Gonsalves said then that the government would retain 49 per cent of the shares and divest 29 per cent to the National Insurance Service and citizens of SVG and the region within 12 months.
Yesterday, he defended the decision to sell the shares to the ECFH, in keeping with the policy of the Eastern Caribbean Currency Union to consolidate indigenous banks, telling reporters that a few years ago, a Trinidad-based bank, which he did not name, had offered EC$500,000 for the entire bank.
"The Bank of St Vincent and the Grenadines IPO empowers Vincentian and other investors in the currency union an opportunity to become owners of a company with strong ties and a long-rooted history in many facets of development within St Vincent and the Grenadines," the prime minister said.
He said that as a listed company, the bank allows stockholder access to a regional marketplace with greater liquidity.
Gonsalves said the government holds 40 per cent of the shares in the bank and has already received dividends of more than EC$1.6 million during an 18-month period.
He said given that the dividends for the first half of last year amounted to EC800,000, he is anticipating a similar figure for the remainder of 2012.
"Which means in two years we would have picked up $2.2 million from the bank," he said.