(a) For over two years now, the status of the two indigenous banks in Anguilla has been a matter of great concern for Anguillians and others who have a vested interest. In more recent times the concern has heightened and nervousness about a resolution of this crisis is increasing among many people. Contributing to this nervousness is the scarcity of information which is official and reliable on one hand, and on the other, the ready availability of opinions which are often emotional and which may or may not be factual or even marginally correct. The way the matter has been handled to date leaves much to be desired, to say the least. The shareholders, depositors and other stakeholders deserve to be treated with much more respect and sensitivity than they have been receiving. The main person responsible for this disregard is our Chief Minister. I am fully aware that negotiations are taking place, and equally aware of the issues of confidentiality in certain matters, the evolving nature of a resolution, the desire to avoid sensationalism, a rush on the banks, and other constraining factors. However, like so many others, I am of the firm view that our Chief Minister has treated the people with less than due respect by being so sparing and non-transparent in a matter that has profound implications for so many of us. There is no real justification that you can give, Mr. Chief Minister, for your failure to be more forthcoming with the people. The people have a right to be informed and to be given the opportunity of making an input. When these things are denied the people, they cannot and will not have the confidence you expect. So we plead with you, Mr. Chief Minister, to treat the people as mature adults who are deeply interested in their own well-being and can contribute to that well-being.
(b) What is in the public domain is that your preferred resolution option will involve the dissolution of the two indigenous banks and the establishment of a new Government Bank, with the government being the lone shareholder. This will mean that the investments of the shareholders in the two local banks will disappear and some 3000 plus persons, or around 28% of the population, will suffer total loss of their shares. Have you seriously considered the impact this will have on the well-being of those persons and their dependants?
Like many other persons who do deeply care, I do believe that a better resolution can and should be pursued. I also believe that with the collective wisdom of the people a better solution can be found but, unfortunately, the people have been shut out to date and have not been given the opportunity to meaningfully weigh in on this matter which will have a transformative impact upon people’s lives.
It is not right, and it is not in the people’s best interest, to agree upon a resolution without the people’s voice being heard. The mandate which your administration has, Mr. Chief Minister, is for the preservation of the two indigenous banks. The drastic move that your government is about to make requires you to hear from the people before proceeding. Whatever you do, the people’s best interests must be given top priority but, from what we are hearing, it does not seem so. If there is need for the information in the public domain to be corrected or added to, please do so generously and not grudgingly.
(c) What is also in the public domain, relative to the resolution of the banking crisis, is that a sum of several million US dollars will be needed and that it is very likely to be raised by way of a bond loan. The UK Minister for the Overseas Territories, Africa and the Caribbean, Mr. James Dudderidge, in a letter dated 6th November 2015 writes: “I understand that in September the ECCB estimated that in order to fund the losses in the banks, the Government of Anguilla would need to issue a ten-year bond for around EC$600 million, requiring the government to raise some EC$70 million on average over each of the next ten years on top of current spending plans.” Mr. Chief Minister, this is not a realistic expectation given a dwindling working population and the present state of the economy. The preferred resolution plan therefore seems overly burdensome, unsustainable and a precursor to much hardship and poverty. Again, I would insist that a better solution should, must and can be found. Consult the people. They have ideas that may well be very helpful. Hear their views as to what they perceive to be in their best interests. You will be surprised. Again, if the information “out there” needs updating, please do so.
(d) What is also in the public domain is that the Chief Minister’s preferred resolution is contingent upon the Governor assenting to the 2016 Budget. The sting in this is that the 2016 budget, the Banking Resolution, the ECCB Banking Bill, the ECCB Asset Management Corporation Bill, the ECCB Asset Management Corporation Agreements, and the establishment of the ECCB Asset Management Corporation are so linked together that assent to the one presupposes or takes for granted assent to the others. This linking has complicated matters considerably, and they should be “unlinked” as far as possible to ensure that in our desire to have a good resolution we are not at the same time submitting ourselves to the dangers of the Asset Management Corporation which have been highlighted elsewhere. From the outside we urge that you proceed rapidly, but with caution of the highest order. What must remain the governing priority is “the best interests of Anguillians”. Again, I urge an update of information, if necessary.
(e) As I close, I highlight two questions being made by some young persons on the street. They are question-worthy of serious consideration as we search for a resolution to our banking crisis, for they raise the issue to a moral or ethical level. Sometimes some of us are inclined to think that an issue is purely economical or financial, political or legal, and we forget the moral, theological and other dimensions. Some of the common folk are asking the following questions: Is it fair, just or morally right for the ordinary citizens who have had absolutely no responsibility for the crisis, who did not benefit from the large loans made, and who would not have benefited in any significant way had things not gone sour, to be now saddled with significant payments from their meagre income for the next ten or more years because of a resolution which is not in the best interest of the people of Anguilla? Should the “common citizen” be called upon to pay such a heavy price, as has been indicated, for the mistakes, bad judgments and decisions of a few? The fact is that we know there is history of how matters like these have been dealt with. Are we being guided by this history? This is more than just food for thought. We cannot ignore the import of the question.
(f) The second question relates more directly to the ECCB Asset Management Corporation to be operated out of Antigua. It is a more pertinent question than the first because the resolution of the banks is fundamentally linked to the Asset Management Corporation. It is the common understanding that every loan which the banks made was received by real estate collateral, and in some cases the dollar value of the collateral exceeded the amount of the loan. It is also the common understanding that these real estate properties were devalued by the ECCB and that the devaluations have serious consequences for the banks, the borrowers and for Anguilla because, as a result, many loans have become impaired. Collateral, which was once considered adequate, and even excessive, is now deemed to be very inadequate because of devaluations of 50% or more. The moral question is again raised: Are the devaluations fair and just? Have they been influenced in any way by considerations other than market forces? Why is it proposed that property taxes in Anguilla will be increased by 25% in the face of the ECCB devaluations? Mr. Chief Minister, if the public information needs to be corrected, please do so.
May God bless you all and God bless Anguilla.
