An­guil­la–The St Kitts-based East­ern Caribbean Cen­tral Bank (EC­CB) says it has as­sumed con­trol of two in­dige­nous banks in An­guil­la not­ing the move is de­signed to en­sure the sta­bil­i­ty of the bank­ing sys­tem in the en­tire East­ern Caribbean Cur­ren­cy Union (EC­CU).EC­CB Gov­er­nor Sir Dwight Ven­ner in a state­ment con­firmed that the op­er­a­tions of the Caribbean Com­mer­cial Bank (An­guil­la) Lim­it­ed (CCB) and the Na­tion­al Bank of An­guil­la Lim­it­ed (NBA) had been tak­en over.

He said the cir­cum­stances that led to this ac­tion in­clude the fact that the economies of the EC­CU are main­ly de­pen­dent for their growth on the tourism and con­struc­tion and that the glob­al cri­sis has had a ma­jor im­pact on these sec­tors.In ad­di­tion, Sir Dwight said that growth in An­guil­la "has vir­tu­al­ly col­lapsed falling from an av­er­age of 15.8 per cent be­tween 2005 and 2007 to an av­er­age con­trac­tion of 5.5 per cent for the pe­ri­od 2008-2012."

He said al­so the banks have seen their non-per­form­ing loans es­ca­late to lev­els be­yond the guide­lines set by the Cen­tral Bank and this in turn has re­sult­ed in the banks not meet­ing their cap­i­tal re­quire­ments.The EC­CB gov­er­nor said the de­ci­sion to take over the banks is al­so in­tend­ed to sta­bilise and re­struc­ture both fi­nan­cial in­sti­tu­tions and re­turn them to a state of nor­mal­i­ty as well as pro­tect de­pos­i­tors and cred­i­tors.

"Fol­low­ing the as­sump­tion of con­trol the banks will be placed un­der a pe­ri­od of con­ser­va­tor­ship. The EC­CB will have full con­trol of the banks for the next six months in the first in­stance to en­sure that these changes are car­ried out to the sat­is­fac­tion of the Mon­e­tary Coun­cil and the Gov­ern­ment of An­guil­la."

He said the EC­CB will be sup­port­ed by teams of ex­pe­ri­enced pro­fes­sion­als from the In­ter­na­tion­al Mon­e­tary Fund (IMF) and the World Bank as well as se­nior bank­ing per­son­nel from the re­gion who will be­gin the re­struc­tur­ing of both banks."The EC­CB has been as­sured of and has had the full sup­port of the British gov­ern­ment in this op­er­a­tion."It will al­so have the sup­port of the World Bank through funds pro­vid­ed by the De­part­ment for In­ter­na­tion­al De­vel­op­ment (DFID."

"We will al­so have sup­port from the IMF through funds pro­vid­ed by the De­part­ment of For­eign Af­fairs, Trade and De­vel­op­ment, for­mer­ly the Cana­di­an In­ter­na­tion­al De­vel­op­ment Agency (CI­DA) for the res­o­lu­tion strat­e­gy pre­pared for the bank­ing sec­tor in the EC­CU. The An­guil­la Fi­nan­cial Ser­vices Com­mis­sion will al­so be work­ing close­ly with the Cen­tral Bank in this ex­er­cise. Bank­ing busi­ness will con­tin­ue in the nor­mal fash­ion on Tues­day morn­ing,' Sir Dwight said.

In a broad­cast to the na­tion, An­guil­la's Chief Min­is­ter Hu­bert Hugh­es said the step tak­en by the EC­CB "has not been tak­en light­ly and ex­ten­sive dis­cus­sions have tak­en place with the For­eign and Com­mon­wealth Of­fice of the British gov­ern­ment and they too have con­curred with this ac­tion."Hugh­es promised that his gov­ern­ment will con­tin­ue to col­lab­o­rate with the EC­CB "to en­sure that the rel­e­vant mea­sures are put in place to pro­tect the in­ter­ests of de­pos­i­tors and cred­i­tors of the CCB and the NBA.

"The Gov­ern­ment is com­mit­ted to en­sur­ing the safe­ty and sound­ness of the bank­ing sys­tem in An­guil­la and there­fore ful­ly sup­ports the EC­CB in its ef­forts to ad­dress the chal­lenges which the banks are cur­rent­ly fac­ing."But he said that while EC­CU mem­ber gov­ern­ments have agreed that the three crit­i­cal pol­i­cy ar­eas at this time are growth, fi­nan­cial sta­bil­i­ty and fis­cal sta­bil­i­ty, the ef­forts to at­tain fi­nan­cial and fis­cal sta­bil­i­ty will not be suc­cess­ful un­less there is some eco­nom­ic growth.

"We there­fore in­tend to ini­ti­ate dis­cus­sions with the British gov­ern­ment on a pub­lic sec­tor in­vest­ment de­vel­op­ment pro­gramme for the long term sus­tain­abil­i­ty of the An­guil­lan econ­o­my."Hugh­es said that he hopes Lon­don "will part­ner with us" in de­vel­op­ing the coun­try's in­fra­struc­ture so as to fur­ther en­cour­age pri­vate sec­tor in­vest­ment.

"It is no se­cret that re­la­tions be­tween my ad­min­is­tra­tion and the UK Gov­ern­ment have been frac­tious as we de­bat­ed the best di­rec­tion for An­guil­la out of this eco­nom­ic and fi­nan­cial de­pres­sion which has over­tak­en us."I have made no se­cret of the fact that for my ad­min­is­tra­tion sus­tain­able fi­nances could on­ly be pred­i­cat­ed on a grow­ing and vi­brant econ­o­my.

"I be­lieve that mes­sage is be­gin­ning to be ac­cept­ed by the UK Gov­ern­ment and I am heart­ened by the fact that the new Gov­er­nor, Her Ex­cel­len­cy Christi­na Scott has de­clared her pri­or­i­ty to be the eco­nom­ic re­gen­er­a­tion of An­guil­la."Scott said that Britain ful­ly sup­ports the move by the EC­CB, not­ing that "in com­mon with many parts of the world, the con­tin­u­ing growth and de­vel­op­ment of the econ­o­my of An­guil­la is de­pen­dent on hav­ing a safe and sound bank­ing sys­tem."

She ac­knowl­edged that the glob­al eco­nom­ic cri­sis has had an im­pact on the British Over­seas Ter­ri­to­ry and that sev­er­al dis­cus­sions have tak­en place with the var­i­ous stake­hold­ers in or­der to ad­dress these chal­lenges.

CMC