Chief Minister and Minister of Finance, Mr. Victor Banks, said the resolution of the banking sector in Anguilla was one of the biggest challenges he faced when his Government came to office in 2015.
The Eastern Caribbean Central Bank (ECCB) took control of Anguilla’s two indigenous banks, the National Bank of Anguilla and the Caribbean Commercial Bank, in August 2013. This followed the ECCB’s own decision and analysis of their financial difficulties – and the required advice and agreement of then Chief Minister and Minister of Finance, Mr. Hubert Hughes – that both banks should go into receivership.
Chief Minister Banks spoke about his challenge with the banking sector at the Government’s anniversary public meeting on Saturday, March 30. He thanked his ministerial colleagues for working with him every step of the way. “I could see at times they were very concerned, but they were never disloyal,” he stated. “They were always confident and were always supportive albeit they also had to be cautious.
“As the Honourable Member for Sandy Hill pointed out, one of the options was that the banks would go in total insolvency and bankruptcy – and depositors would receive cents on the dollar. This was a real option that was being put before the Government of Anguilla, and when we sat in Executive Council with the powers that be, from the Foreign and Commonwealth Office, they explained to us their plan of action for the resolution of the banks. This included a pile of regulations already prepared to go and be implemented by Order in Council, to take over the banking sector, give persons cents on the dollar and, to their mind, resolve the banking situation in Anguilla. We said no, no!
“It was not crocodile tears that I cried in Executive Council, on two occasions, when I recognize the enormity of the challenge that we were facing – and the fact that Anguilla had very little options and places to turn to, but we were determined.”
Mr. Banks went on: “For this I must thank the Eastern Caribbean Central Bank, the World Bank, IMF, the Caribbean Development Bank, and those officials in the Ministry of Finance, here in Anguilla, who sat with us to work out a solution that would secure 100 percent of all the deposits of Anguillian customers, both large and small; take over the banks; restore them to a level of solvency; and put a resolution in place that, even though challenging up now, has been successful in turning Anguilla’s indigenous banking sector around.
“It is something that we, in the Anguilla United Front, as your Government, remain proud of. But we must admit that it could not have been possible without the support and confidence of the customers of the banks who were loyal to the banks for what they had done for them in the past in terms of their families: when they needed first home mortgages; public assistance for education and health overseas; personal development of all kinds; purchase of transportation and vacation. These banks were patriotic to the cause of Anguilla’s development and our people stuck with them and your Government in taking a resolution forward.
“One of the things we also had to do was to secure the Anguilla Social Security Fund which is put together by the contributors of the employment sector – both employees and employers. This is so that workers can receive pensions and support when they reach the age of retirement, or when they are unable to work on account of illness or other infirmities. That was a total of 214 million dollars, and the Government of Anguilla made the decision that it was important to secure future generations and, as a part of the resolution, took out a bond of 214 million dollars for 25 years. It was to secure the contributors and pensioners of the Anguilla Social Security Fund – for you the people of Anguilla.
“When you here the opposition jumping up and talking about this Government came into office and doubled the national debt, you must let them know that we make no apologies for doubling the national debt because 214 million dollars, 100 percent of that debt, was to meet the requirements of the aged and the infirmed people of Anguilla in the Social Security Fund. That is why we have that debt. But I want to say to you that we are managing that debt. The Government of Anguilla has never defaulted on its debt obligations.”
The Chief Minister observed that the National Commercial Bank of Anguilla is continuing to be well supported and successful in its operations.
