Republic Bank/ Scotiabank deal not yet approved

The Bank of Guyana is still in the process of conducting its due diligence as it relates to the Republic Bank takeover of Scotiabank operations in Guyana and the Government of Guyana says it is still not in favour of the sale.

“We made our views very clear earlier this year that we’re not in favour of the agreement, we said the reasons why we’re not in favour of the agreement. That hasn’t changed at the level of Cabinet,” Finance Minister Winston Jordan told reporters at the sidelines of an event recently at the Marriott Hotel, Kingston, Georgetown.

“I’ll let the Bank of Guyana do its work and when it’s completed, we’ll go from there,” he added.

Republic Financial Holdings Limited, which owns the Republic Bank operations in the Caribbean, announced in November 2018 that it will be acquiring Scotiabank operations in several regional territories, including Guyana.

The Government of Guyana had raised several concerns noting that the deal is going to breach the Financial Institutions Act (FIA).

If the transaction is approved, RBL will end up owning 50% of the total banking assets in Guyana.

Earlier this week, the Eastern Caribbean Central Bank (ECCB), in consultation with the ECCB Monetary Council approved the transfer of assets and liabilities in several regional territories.

According to a release, the Republic Bank based in Trinidad and Tobago has received the green light to take control of the operations of Scotiabank in Anguilla, the Commonwealth of Dominica, Grenada, St Kitts and Nevis, Saint Lucia and St Vincent and the Grenadines, pursuant to Section 43 of the Banking Act.

But Minister Jordan said the ECCB’s case is different from that of Guyana.

“The Scotiabank in Guyana is not the same as the Scotiabank in the Eastern Caribbean and the role that they play in the Eastern Caribbean,” he said.

Mr Jordan had explained in December that if the laws block the Republic/Scotiabank business deal, an alternative transaction is for Scotiabank to sell its assets to other financial institutions.