President Dr. Irfaan Ali on Thursday defended the government’s regulation of the local financial sector amid calls for new partnerships to help fund the country’s development aspirations.
“A short while ago, we came in for some criticism for denying the buying of a certain financial institution by a major regional bank.
“We are mindful of the risk of allowing any one financial institution to have an inordinately large share of the sector which can expose us to risk,” President Ali said as he addressed the Jamaica Stock Exchange’s Regional Capital Market Conference 2023.
What he was referring to was an attempt by Scotiabank to sell its Guyana operations. The bank first tried to sell to Republic Bank Limited and then to the First Citizens Bank Limited – both Trinidad and Tobago banks.
Both banks were subject to regulatory approvals from Guyana’s Central Bank. But the deals were not pursued by Scotiabank.
President Ali explained that the concentration of financial services may have exposed locals to risk. And so, he signalled the government’s preference for “diversity and spread” as “insurance to protect investments.”
Still, he clarified that the government is not opposed to new financial partners. In fact, he issued an “open invitation” to regional institutions able to invest in Guyana.
“We have not yet set our sights on becoming the financial epicentre of the Caribbean… but with the financial sector set to expand, our financial needs are great,” he said.
This is a wise move. You know the old axiom ‘ never put your eggs in one basket ‘. We have experienced the failure of banks and financial institutions recently so spread the wealth of the nation for future financial prosperity.