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Jun 24, 2020

Does Scotiabank Purchase Change the Local Financial Landscape?

Since Monday, we have been reporting on the pending acquisition of Scotiabank Belize’s assets by Caribbean Investment Holdings Limited.  The Canadian Bank has been selling its branches in the region for some time now and like in other countries, the sale is a delicate situation that the Central Bank is charged to manage to ultimately preserve equality in the sector.  On Monday, after the announcement by C.I.H.L. and Scotia Bank, Governor Joy Grant issued a public statement to ensure confidence in the sector and economy.  The transaction is more than thirty million U.S. dollars and provides a huge infusion of economic activity.  News Five spoke with former Central Bank Governor Glen Ysaguirre, who provided some insight on how these business deals are handled.

 

Glen Ysaguirre

Glen Ysaguirre, Former Central Bank Governor

“It is a very significant transaction that will obviously change the landscape of the banking sector in Belize given the size of the market share that the acquiring group will have in the local banking sector.  And it also means, too, that we will have fewer less players in the market space and so it will change the overall landscape and it is something that I think needs to be managed in a very careful way to ensure that we have and maintain financial stability and maintain some kind of parity across the banking system with regards to the regulatory framework. The first person the negotiating parties would be required to inform even before a public statement was made would have been the Central Bank because obviously the consummation of such a deal would require the Central Bank’s approval and so there is nothing wrong with the Central Bank putting out a statement.  People might want to argue and quarrel about the language in the statement or the enthusiasm in the statement but that’s a personal position that the governor needs to take.  No, the Central Bank should be at the forefront and should be and is required to make a statement on such a monumental deal that would obviously change the entire landscape of the banking system and they will have to be intimately involved in the whole transition process.  So that’s par for the course, as you would say, and part of their mandate.”


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