No stopping NCB divestment process

Although the divestment of 51 per cent of shares in the National Commercial Bank (NCB) has not yet been concluded, it is unlikely that the process will be stopped.{{more}}

At a press conference on Tuesday, October 12, at the NCB’s Bedford Street Branch, CEO of the Bank Andre Iton said: “The sale is not yet concluded. The Government as the vendor of the shares has entered into agreement with the ECFH, which would seek to have the transaction completed prior to the end of November,” said Iton, adding that there are a number of legal and administrative matters that have to be attended to for the sale of 51 percent of the NCB’s shares to be completed.

The press conference was held just one day after some persons attending a town hall meeting organized by the Junior Bacchus and Matthew Thomas, hosts of the NICE Radio call in show “Stay Awake” questioned whether it was too late to stop the sale of the Bank.

A legal expert also advised SEARCHLIGHT that for any person or group to be successful in getting an injunction to stop the sale of the bank, the entity must have shares in the institution or must be deeply affected personally.

The Government of St.Vincent and the Grenadines is the sole shareholder of the NCB.

The expert added that if the Government is to pull out now from the sale agreement, it may have to pay ECFH damages.

Prime Minister Dr. Ralph Gonsalves in a telephone interview with SEARCHLIGHT on Wednesday, when asked about the interest groups’ chances of stopping the sale, said: “Nothing can be done to stop it in the legal sense. The only thing that can stop it is the Government.”

Gonsalves said the decision was thought through carefully, and some of the best minds in the region, including Governor of the East Caribbean Central Bank, Sir Dwight Venner, have lent their minds to the process.

Chairman of the NCB Errol Allen, chairing the press conference on Tuesday afternoon, expressed that in today’s global environment, small stand-alone banks have been experiencing many challenging times. He said a year ago, the OECS countries adopted an eight point growth and stabilization programme where the amalgamation of indigenous commercial banks was one component of that programme, and this policy is pursued by the NCB.

He said the NCB had long recognized that its small institution needed to expand its capital base and to seek a strategic alliance with an institution that will improve its operating systems, introduce new innovative products and in the process improve efficiency.

“In the East Caribbean Financial Holdings in which the Bank of St. Lucia is a subsidiary, we have found a good fit which matches our culture. We believe that this is in the best interest of us all, and we have so recommended it to our prime minister who holds the shares of the bank entrust for the people of St.Vincent and the Grenadines,” said Allen.

At the Thursday, August 5, 2010, sitting of Parliament, Prime Minister Gonsalves announced that the NCB is seeking to conclude the necessary negotiations with a regional bank for the purchase by that bank, of majority shareholdings in the NCB.

Two months later, on October 1, in a press release, the NCB announced that Government had reached an agreement with the ECFH on the privatization of the NCB.

The agreement will see the ECFH holding majority ownership interest of 51 per cent. The Government of St. Vincent and the Grenadines will retain the balance of shares (49 per cent), with the intention of divesting 29 per cent of their shares to the St. Vincent and the Grenadines National Insurance Service (NIS), citizens of St. Vincent and the Grenadines, including bank staff and citizens of the region, within the next 12 months. (HN)