Unprofitable operations forced banks off sister islands—Premier
As a result, the Government is now is examining the use of cashless transactions in addition to attempts at attracting new banks to the Territory to replace those that closed operations on the sister islands including First Bank, First Caribbean International Bank and Scotia Bank
Recurring Issue
The reasons behind the banking institutions closing their doors on the sister island of Virgin Gorda, was disclosed when Leader of the Opposition, the Honourable Andrew A. Fahie (R1), pressed Premier and Minister of Finance, Dr the Honourable D. Orlando Smith (AL) on the state of banking services in the VI, during a sitting of the House of Assembly (HoA) on July 24, 2018.
Hon Fahie requested the Premier, “…inform this Honourable House, why the different banking institutions that physically operated in Virgin Gorda left, or are in the process of leaving and how the government intends to address this recurring issue.”
In response, the Premier said, “the banks that previously operated on Virgin Gorda, all reported that the Virgin Gorda operations were not profitable and therefore could no longer be sustained.”
Cashless
He further disclosed that “the Government is currently in discussions with other institutions to determine their interest in filling the void that has been created by the recent announcement by Scotia Bank that it will be terminating its operations in Virgin Gorda.”
He was unable to say however, whether any of the banks, would be returning to the island, or when, instead offering the platitude, that “the reality is that the decision of any enterprise, bank or otherwise, as to where it will locate or operate from is purely a business decision based on commercial realities.”
Pressed further by the Opposition Leader on Government’s plans to address the banking needs of residents on Anegada and Jost van Dyke, Dr Smith revealed that “in addition to discussions with existing institutions, my Government is considering other options such as the provision of cashless money services.”
He did not offer any further details.
Scotia Bank, which is the only remaining banking institution on Virgin Gorda—the second highest most populated sister island—is scheduled to cease operations by September 1, 2018, leaving residents without any banking services.
Many critics of the Government have said they continue to drop the ball on their treatment of the sister islands.
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9 Responses to “Unprofitable operations forced banks off sister islands—Premier ”
I’m assuming that the bank headquarters, along with branches, must be self supporting from interest on loans and fees. Nevertheless, banks are in operations in the BVI so they must be turning at least the minimum projected profit margin. As such, is the overall profit margin of the bank(s) sufficient to supplement banking operations on the sister islands yet turn a reasonable profit? This (supplementing) would demonstrate positive and amicable corporate social responsibility(CSR). Undoubtedly, the banks give back to the community; supplementing operations in the sister islands would increased its give back to the community, increasing their CSR. Moreover, what is the major contributing factor(s) to the unprofitably, ie, low or declining loans, high overhead, ie, rent.....etc? Can government use taxpayer funds to incentivize banking services on the sister islands?
'pedigree' chart? 'S' for example, went from ridiculous to insane. So those who didn't measure up to
their 'high' standards merely took their banking business elsewhere.