Feature Address by the Prime Minister on the Occasion of the Inauguration of the BANK OF SAINT LUCIA - JULY 1, 2001

Feature Address by the Honourable Prime Minister

on the Occasion of the Inauguration of the

JULY 1, 2001

STILL STRONGER TOGETHER

Salutations….

In the ancient culture of the Far East, well-wishers offer the phrase: May you live in interesting times. Although I am no guru of oriental philosophy, I believe the phrase captures the potent wisdom and optimism so characteristic of that ancient culture; a culture that acknowledges change as the father of opportunity. We also have a phrase that praises necessity as the mother of invention, and I would like to take these few minutes to bridge those two philosophies by reflecting on the change we have wrought out of necessity, and how we might expect to prosper by our inventiveness.

No one will make light of our current economic circumstances. We all acknowledge that we are facing serious challenges to our economic viability and that this is not likely to change soon. Some of this we owe to our own inattention over several years. Some of it we owe to external pressures. This is true of Government, of firms, of institutions and indeed of entire sectors. We have classic examples all around us of entities which have have ignored or tried to delay competitive realities only to their peril. Yet, we also see around us, bold new initiatives: restructurings, resizings, realignments, partnerships and new management structures. All of these confirm that globalisation not withstanding, we will not go quietly into that dark night of economic extinction.

Nevertheless, as painful and as challenging as the times may now seem, there remains a dire need to continue the renovation of our economy. We must take charge of the things we can change. And the things we can change include the way that Governments, firms, institutions and industries operate. Our individual and collective management of change will determine whether we sink or swim. There is no returning to the status quo ante.

It is therefore the expressed policy of this Government to pursue, encourage and support that renovation and to make it as pervasive and sustainable as possible. Let us take heed, that all over the world the ground is shifting. The tremours of inevitable change run through the jungles of commerce and trade and finance. It is as if the ghosts of extinct dinosaurs are reminding us of their own unforeseen demise. Let us take heed, that old assumptions are now shattered and established hypotheses overturned. Not only can we not go back, Ladies and Gentlemen, we cannot afford to stand still.

The merger and reconfiguration of our two pillars of commercial and development banking is not a fanciful or coincidental occurrence. It is a deliberate, determined and desirable strategy. It is part of the process of taking charge of the things we can change and signalling to the world that St. Lucia is open for business. Not business as usual, but business in a brave new, competitive world. That world must never again look upon us, cap in hand, wondering if we are serious about our own destiny. Therefore we must be convinced, by our own actions, that we are indeed worthy partners in a process of mutual and profitable advancement.

So much for challenges; here is St. Lucia’s response. Here we have a seamless partnership, a marriage if you wish, that gives birth to a family of financial institutions, serving the interests of St. Lucia as never before. Let me re-introduce you to the members of that family of institutions. The Bank of St. Lucia will encompass six separate companies. Besides the parent company, there are the following:

The Mortgage Finance Company of St. Lucia will be a dedicated window to deal with both individual and corporate clients, ensuring that home ownership - and other ventures financed through mortgages – will remain an affordable and achievable aspiration for all St. Lucians.

The Offshore and Financial Services Company of St. Lucia will take a leadership role in the development of that sector and ensure a public policy role for government in shaping and influencing the sensible development of this emerging industry.

The Trust and Legal Services Company will develop in-house expertise, spawning a whole new cadre of expertise among St. Lucian professionals, and provide the Bank with a reservoir of technical skills, available to itself and to third parties. The majority of the shares of this company – some 55% - will be made available for sale to the public.

The Insurance Company of St. Lucia will provide add-on services to the Bank’s clients, and help to leverage financial resources in the market. Fifty-five percent of this company will be owned by the parent company, Bank of St. Lucia, with 45% of its shares to be made available to the public.

The Property Holding and Developing Company of St. Lucia will manage the real assets of the Holding Company and play a major role in the redevelopment of strategic commercial properties, particularly in the City of Castries. This is consistent with existing policies and incentives supporting the transformation of our commercial landscape and the upgrading of the central business district. St. Lucians will also be able to invest in this process, as 45% of this company’s shares will be available to the public.

The public offering of such shares is a deliberate policy of this administration as it seeks to accelerate the development of our capital market and diversify the range of investment options for St. Lucians. When this process takes root, it will be increasingly possible for St. Lucians to participate meaningfully in the wealth and well-being of our indigenous financial institutions. This process began with the withdrawal of Government as dominant shareholder in NCB. This deliberate policy has created new economic space; a space large enough to accommodate a whole new family of related institutions. No longer will our savings options be limited to idle cash in fixed deposits, waiting for someone else to invest. We will be investing in our own future.

To compound this good fortune the Bank will offer Investment Banking functions as an important intermediary in the sale of securities and equities under the auspices of the Eastern Caribbean Securities Exchange. This institution is to be inaugurated later this month. So much for challenges; this is our response, and it is just the beginning.

By virtue of the NCB initiative, the new Bank of St. Lucia begins its life with a regional outlook which extends to Barbados and the rest of the Eastern Caribbean. Its Board of Directors will include a representative of the Barbados National Bank which held a 10% stake in NCB. Other OECS institutions - such as the East Caribbean Financial Holding Company – which held 20% of NCB will provide two other regional directors.

Other members of the Caribbean Association of Indigenous Banks (CAIB) are looking on eagerly at our pioneer progress and anticipating similar strategic moves within their own banking sectors. Indeed, the President of the CAIB has been a professional ally in the design and implementation of the merger strategy. I wish to convey our collective gratitude to him for his faith and support.

We know that institutional cultures do not undo themselves overnight, even with the best of intentions. I must therefore take this opportunity to commend the Boards, the Management and the Staff of both institutions for their steadfast perseverance. From the inception of this initiative, the Boards of both SLDB and NCB have demonstrated the clairvoyance and maturity that allowed them to manage the complexity of a brokered marriage.

No doubt, the atmosphere of negotiation and compromise has been abetted by the fact that issues of job security were quickly and quietly resolved. In this way, the human uncertainties which typically oppose constructive change did not add to the difficulties of the proposed union. I am pleased to learn that a unified salary scale has achieved universal acceptance, and is to be implemented forthwith. We can also be assured that the internal process of training and retraining continues.

Let me assure you also, that the future of the development portfolio is far from bleak. The Boards of both Banks, in their wisdom, have ensured that there will be no dilution of this most important function. Bear in mind, that we are talking about two profitable institutions, both of which came to the marriage table with their own strengths and successes. As such, there was less risk of corporate canabilization. Indeed, there will be a dedicated staff-core specifically for development lending activities, such as housing, education and agriculture. Moreover, there will be a Business Advisory Service as well as a Small Business window within the new institution.

Elsewhere, the banking industry continues its constant evolution towards efficiency and strategic repositioning. There will be other changes in the months ahead. We should be prepared for other mergers and realignments. In this regard, I would like to signal that Government would be very receptive to the participation of other indigenous financial institutions in this process of change and innovation. If there is some strategic support which we can lend to that process we should be happy to learn of it.

Ladies and Gentlemen, before I close, I must commend the invaluable leadership of Mr Marius St. Rose, Managing Director of the former National Commercial Bank of St. Lucia. He has been a loyal captain through fair and foul weather, and has brought us safely to port. He could not have done this without winning the confidence of his peers and that of the Board, Management and Staff of the St. Lucia Development Bank. I salute you, as I do them, as we embark on this exciting new voyage.

Ladies and Gentlemen, this is a timely initiative. This is a proud moment. This is the hallmark of a brave society and a forward-looking nation. I bid you to have faith in the process of change; not the blind faith required of martyrs, or sheep to the slaughter, but the faith which comes from knowledge, information and experience.

In an era when privatisation and restructuring send shivers through institutions and entire economies, St. Lucia is successfully finding its way through the reconfiguration of its parastatals, its utility companies, its banana industry and now its banking sector. Our initiatives in these areas, as well as the strategic repositioning of our private sector supported through the Office of Private Sector Relations, are shining examples of a country taking its fate into its own hands.

Finally I would say to you: be proud; be persistent; be purposeful. Ours is the future. Let us proceed there as a dynamic and determined nation proud of our land, proud of our people, aspiring always toward the light which continues to shine upon us in ways we are only beginning to discover.

[ Home ] [ Up ] [ Office of the Prime Minister Site Map ] [Site Help]

© 2012 Government Information Service. All rights reserved.

Read our privacy guidelines.