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#503608 - 04/23/15 10:55 AM Belize Bank, Bank of America Sever Relationship
Marty Online   happy

Belize Bank Loses Correspondent Bank Relationship With Bank of America

The Belize Bank is Belize’s largest bank – controlling about half of the banking sector, and it’s Belize’s largest domestic lender – but tonight the bank is preparing for a significant change in operations. That’s because as of April 30th., it will lose its correspondent banking relationship with the Bank of America. This means that the bank will no longer be able to do international banking transactions such as wire transfers to or from the US. Importantly, it will still be able to do credit card business as usual.

We spoke with Lyndon Guiseppi, the CEO for BCB Holdings and he told us that the vast majority of the Bank’s clients - more than 90% - will not be affected by this. He called it “a manageable phenomenon” and says that the bank is “transitioning smoothly” by reaching out to all its clients who use these services to give them a list of alternatives. He said those customers who need to send a wire can do it through the Central Bank or other commercial banks. Guiseppi said the bank does not anticipate “a major fallout or major impact on day to day operations” and typical clients who go to the bank to deposit, withdraw, borrow or pay on credit cards will experience nothing different. He stressed that it is not a liquidity problem but a regulatory issue coming form the United States. When we asked if the bank will shrink as a consequence of this, Guiseppi said his bank is “still able to do the largest loans in Belize and can still generate foreign exchange through its credit card business.”

In the Corozal Free Zone, however, it’s not that simple; the bank has taken the decision to move out of the zone completely based on a risk audit.

So does it have implications for the wider banking system? Well, we spoke with the governor of the Central Bank of Belize, Glenford Ysaguirre who told us, quote, “there should be no alarm at the local level…and should it should have no damaging effect on the wider economy, and other domestic banks are not at risk”. He added that those other banks are prepared to take up the slack.

He explained that the de-risking by the Bank of America is “not an issue with the jurisdiction of Belize,” and that “the Bank of America makes its decisions and analysis based on individual institutions and their business model.” He noted that “several banks across the Caribbean are suffering the same fate and it is mostly the indigenous banks.”

Ysaguirre pointed to the Holy Redeemer Credit Union which is larger than a few banks – and pointed out that they have never had a correspondent banking relationship – and it doesn’t affect their volume of business.

Of course, that would hardly be satisfactory to the very corporate Belize Bank – and Guiseppi told us that he is working very hard to establish another correspondent banking relationship – and he hopes to do so within three months.

Channel 7


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#503624 - 04/23/15 04:38 PM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
JZB Offline
" We spoke with Lyndon Guiseppi, the CEO for BCB Holdings and he told us that the vast majority of the Bank’s clients - more than 90% - will not be affected by this. "

Notifying the 10% of their clients who ARE affected by this would have been a nice move on Belize Bank's part.

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#503627 - 04/23/15 05:58 PM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
SimonB Offline
I'm affected and no one has contacted me.

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#503629 - 04/23/15 06:00 PM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
Diane Campbell Offline
I went to. BBI today. They had no updates.

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#503637 - 04/24/15 10:14 AM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
Marty Online   happy

from friends...

did you see the PM's speech at the recent conference, remarks re the US interfering with local (belizean) banks?

i know many who have closed their accounts over this long pending issue.

We spoke with the governor of the Central Bank of Belize, Glenford Ysaguirre who told us, quote, “there should be no alarm at the local level…and should it should have no damaging effect on the wider economy, and other domestic banks are not at risk”. He added that those other banks are prepared to take up the slack. ...Guiseppi [Lyndon Guiseppi, the CEO for BCB Holdings] told us that he is working very hard to establish another correspondent banking relationship – and he hopes to do so within three months.

DON'T BeLIEve a single word The Governor of the Central Bank of Belize has to say!!! A typical example of WHO you know, NOT what you know.He is one of the most incompetent Governor, The Central Banks has ever had!!! When the reality of this hits home, it will be too late for many Belizeans who are heavily dependent on imported goods. The importers wont be able to pay their international Suppliers.

Free Zone customers were given until 1 pm today to settle their affairs.

Very huge implications ... the PM was on target when he was with Obama in Panama on the effects of US policy on us but toned down a bit at home to alleviate fears I think but the issue is real and very serious indeed.



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#503640 - 04/24/15 10:33 AM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
Marty Online   happy

Belize Bank To Close Its Doors At CFZ

There is much concern over the reported imminent end to the relationship with the Country’s largest bank, the Belize Bank Ltd and its partner Bank of America. Our colleagues at 7News reported that as of April 30th, the bank will no longer be able to do international banking transactions such as wire transfers to or from the United States.

It may seem like some serious implications may occur but according to the report, more than 90 percent of the banks clients will not be affected.

Additionally, it is not known if the relationship with Bank of America affected the closure of the Belize Bank Branch in the Corozal Free Zone. We have been reliably informed that at the moment the branch in the Free Zone is the only one closing and returning people’s money.

The banks closure will be made official on May 1st of this year. We are told that the staff will be relocated to other branches with staffing needs such as San Pedro and Belmopan. The Free Zone Belize Bank Branch had a total staff of 6. Our attempts to get comment from CEO at the Banks Cooperate Headquarters and comment from the CEO of the Freezone David Ackerman were unsuccessful. We’ll keep pursuing this story in tomorrow’s newscast.

PlusTV


Belize Bank Duty Free Branch Closing Down

Reports have been reaching us throughout the day that the Belize Bank Duty Free Branch might be closing down.grey Belize Bank Duty Free Branch Closing Down

Workers at the Northern Border Free Zone are claiming that the Bank Branch has notified all its clientele who are currently banking with them at the Duty free zone that they will be closing down.

According to various sources, Belize Bank Ltd. has given them until 1:00 pm on Friday April 24th 2015, to clear all bills.

The official closure of the free zone branch is May 1st 2015.

Breaking Belize News


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#503653 - 04/24/15 04:01 PM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
JZB Offline
..Still waiting on Belize Bank to say something. When I inquired yesterday I was told the acting Manager would be in touch with me shortly with information. They are leaving their clients no option but to use another bank.

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#503655 - 04/24/15 04:14 PM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
Marty Online   happy

Bank of America severs relations with Belize Bank

Bank of America, the second largest bank in the US, has severed its correspondent banking relations with the Belize Bank, our largest commercial bank, which means that unless the Belize Bank can find another bank partner overseas, it will (as of April, 30) no longer be able to provide wire transfer services to its customers.

Roughly two weeks ago, Prime Minister Barrow used the platform of the Summit of the Americas held in Panama to highlight a potential financial crisis unfolding in the Caribbean, where, he said, US banks were de-risking by cutting off correspondent banking relations with banks in the region.

Without providing details, Barrow said that, “…even as we speak, there is a crisis in my own country and in several others in the Eastern Caribbean, where the big US banks are ‘de-risking’ by terminating their correspondent relationships with our domestic banks. Indeed, even our Central Banks are being cut off; and our financial and trade architecture cannot survive this phenomenon.”

At the time, there was no report of any bank in Belize being severed by their correspondent bank; however, Lyndon Guiseppi, chairman of the Belize Bank, has confirmed to Amandala that Bank of America has decided to sever its correspondent banking relations with the Belize Bank.

What is the reason for this decision?

“We have been advised that this event has been prompted by a change in business model. We are not in a position to comment on Bank of America’s decision to discontinue the relationship,” Guiseppi said.

He explained that the change is expected to have a temporary and limited effect on clients that use US dollar wiring services only.

“We are contacting clients who use this service regularly to provide them with alternative options,” he said.

“We are in advanced discussions with several US, European and Asian banks and are confident that we will establish a new correspondent banking relationship within a reasonable timeframe,” he added.

The Belize Bank chairman said that de-risking is a phenomenon that has a limited and contained effect in the domestic banking and International Financial Services sectors, which the Belize Bank International also offers.

“Most of our valued clients will experience no changes whatsoever in the level of service which they have come to expect from the Belize Bank over the years. For those limited customers who may be affected, we are working closely with them in collaboration with the Central Bank to provide them with alternative solutions. Clients conducting regular banking business such as deposits, withdrawals, credit card payments or loan applications will not be affected whatsoever. For the vast majority of our clients it will be business as usual,” Guiseppi said.

Caribbean columnist Sir Ronald Saunders, a senior fellow at London University and a consultant on international affairs, had penned his thoughts in a column appearing in Caribbean papers around the same time that Barrow made his statements in Panama. Speaking of the much celebrated US-CARICOM summit held in Jamaica, Saunders noted that, “The Caribbean region has been categorized as a ‘high risk area’ for financial services and this is resulting in indigenous and offshore banks losing vital correspondent-bank relationships in the US.”

Saunders said that many of the US banks are unwilling to take risks with banks located in a ‘high risk’ area, particularly when the earnings from the relationships are small.

He added, though, that “…for Caribbean banks, the relationship is vital to transacting international business. If they lose their relations with correspondent-banks, they will be forced to close their doors with consequential effects on employment. The only banks that would be left standing are subsidiaries of established foreign-owned banks that have a relationship with their headquarters’ institutions.”

Belize is one of the countries listed by the US as a jurisdiction of primary concern for money laundering—a listing which prompted the Prime Minister’s recent comments at the Summit of the Americas.

Amandala


Central Bank Says Banking Industry Stable

On Wednesday, we reported that the Belize Bank would be losing its correspondent banking relationship with the Bank of America on April 30th. This makes it impossible for them to make international wire transfers and bank drafts. Today in a rare press release, the Central Bank of Belize confirmed that Belize Bank and Belize Bank International are losing their correspondent banking relationships. The Belize Bank International is a foreign currency banking service for non-Belizeans.

The press release confirms that Scotiabank, Atlantic Bank, First Caribbean Bank and Heritage Bank have not been affected. The release adds that the Belize Bank will continue to offer credit card services and is seeking ties with other foreign correspondent institutions.

CEO of the BCB Group Lyndon Guiseppi told us he expects the Belize Bank to establish a new correspondent banking relationship in three months.

Channel 7


Central Bank Issues Release on Derisking

Earlier this week, Financial Secretary Joseph Waight commented briefly on the ongoing derisking exercise that a number of large American and European banks have undertaken. The process has seen the financial institutions severing ties with select banks in small developing countries. On Thursday, the Central Bank of Belize issued a release explaining the foreign correspondent banking relationships in light of a decision that seems to be linked to the enforcement of heavy regulatory fines for offences related to the recent global financial crisis and breaches of geo-political sanctions.

While Scotiabank, Atlantic Bank, First Caribbean International Bank and Heritage Bank are not affected by derisking, the same cannot be said for Belize Bank and Belize Bank International. Both institutions are losing foreign correspondent banking relationships. The public is therefore advised that the previously mentioned banks will continue to conduct foreign exchange transactions. The Belize Bank, on the other hand, will be making its reserves of foreign exchange available to the Central Bank to make certain that the needs of its customers and the rest of the domestic system will be served.

Channel 5


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#503826 - 04/30/15 11:17 AM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
Marty Online   happy

PM’s Resolution for US Bank De-risking

At the top of the newscast, we told you about today’s press conference where much of the talk was about Petrocaribe. But the event last almost two and a half hours, and the Prime Minister spent the first 70 minutes going through a number of issues of public interest. Foremost among them is the Belize Bank – and the recent loss of its correspondent banking relationship with the Bank of America. That was the subject of a meeting the Prime Minister held with Bank officials in Miami this weekend – and today he told the media that the message coming out of those meetings is that the rest of the banking sector is stable:…

Dean Barrow - Prime Minister of Belize

"A part from the Belize Bank, there is none of those local banks which is in any danger of having Bank of America withdraw in corresponding banking relationship them. That was absolutely confirmed to me by all the officials with whom I met. There is not any sort of looming storm cloud in the horizon. I want to make clear, that Bank of America insists that it is nothing that the Belize Bank has done wrong. There is some misalignment according to them between their business model and the business model of the Belize Bank. They're's no question of any kind of blame, there is no question of any kind of wrong doing on the part of the Belize Bank. I will say here and now, I've had my difficulties with the principal shareholder of the Belize Bank. The government of Belize fully supports the Belize Bank. It is the largest bank by market share in this country. It services a number of sectors of the economy and we are determined that we will hold hands with the Belize Bank to help to see them through this temporary and I believe in a larger scheme of things, minor setback.“

Channel 7


Executive Chairman Says It’s Business As Usual for Belize Bank

Lyndon Guiseppi

In past three or four years, the large U.S. Banks and some European Banks have been facing some of the largest fines in the history of banking. Those fines, according to Lyndon Guiseppi, the Executive Chairman of Belize Bank, relate primarily to the banks being sanctioned for doing business in jurisdictions or in countries with clients who the U.S. may have had an embargo against or who may be involved in terrorist financing. Those banks, explains Guiseppi, where profits are lower than fines, have been taking the decision not to continue operating in certain jurisdictions in Africa, the Middle East and now in the Caribbean. He also explained the steps that the Belize Bank is taking to ensure that business flows.

Lyndon Guiseppi, Executive Chairman, Belize Bank

“It has recently come to the Caribbean and I know, for instance, that in many jurisdictions in the Caribbean in St. Lucia, St Vincent, Bahamas, Antigua, Grenada, Barbados, in Jamaica there have been incidents of banks or finance companies in those jurisdictions who have found themselves in a position where some of the correspondent banks are sort of retracting from the region. It has now come to Belize. So, that is really how I would explain to you this whole concept of de-risking.”

Isani Cayetano

“Now, in terms of the Prime Minister’s, the Government’s input in trying to facilitate, if I may, a solution for this issue. Can you share with us how that has been in terms; well the PM spoke on the meeting that was held in Miami recently. In terms of the way forward and the specific plan of action moving ahead, what is that like?”

Lyndon Guiseppi

“Well, let me say from the onset that, I fully endorse everything that the Prime Minister said at the press conference this morning and I certainly welcome the remarks and the continued support that we have gotten from the Prime Minister himself, personally, Ministry of Finance and also from the Central Bank. They have been extremely collaborative during this period and we’ve worked together and I believe we have a solution for what we see happening. But before I even got there, let me reassure you, and our public and our valued clients that for those of you who would go to a Belize Bank branch tomorrow, absolutely nothing will change. Whether it is you want to make a deposit, whether it is you want to withdraw funds, whether it is you want to do a bill payment, whether it is you want to pay a credit card, or whether it is you want to send money abroad for your son who might be studying abroad or pay for goods, tomorrow morning when we open our branches you can do all of those services with the Belize Bank. This issue of correspondent banking is a very temporary situation. It is a very contained situation. But as I speak, and for the next couple of months, and certainly for the foreseeable culture, our clients, the vast majority of clients who comes to a Belize Bank will be able to do exactly what they did for the last thirty or forty years they’ve dealt with us. That is the assurance I give you today. In terms of the Central Bank’s role in all of this, the Central Bank has indicated its preparedness to support us; I want to emphasize that, in the event that we have any issue. The only issue I anticipate, for instance, that a customer want to make a wire payment to purchase goods and services, but at this point in time I do not believe necessarily we would need such support. Because that can be facilitated by using a credit card- you can pay with your credit card to import goods. But as I had indicated before, for the next couple of months we have absolutely no restrictions whatsoever in making wire payments for our clients who need to wire funds or to receive funds into Belize. So, for all those who are listening again, the sky has not fallen out and we continue to be the pre-eminent banking group in Belize and our aspirations is to certainly become the pre-eminent banking group in the wider Caribbean. We continue to do business as usual.”

Channel 5


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#503985 - 05/05/15 05:48 PM Re: Belize Bank, Bank of America Sever Relationship [Re: Marty]
Marty Online   happy

Central Bank to be alternate route for wire transfers from Belize Bank customers

Bank of America principals who met with a high-level team of Government officials, including Prime Minister and Minister of Finance Dean Barrow; Central Bank Governor Glenford Ysaguirre and Economic Advisor, Ambassador Mark Espat, have given their assurance that the bank is severing relations only with the Belize Bank, and not with any other domestic bank in Belize which has correspondent banking relations with the second largest bank in the USA.

Barrow said that based on their conversation with the bank executives, “…there is no question of any kind of wrongdoing on the part of the Belize Bank.” He added that, “…nobody needs to feel that he or she has to stop doing business with the Belize Bank.”

At a press conference, attended by Belize Bank International’s executive director – Filippo Alario, who is also the chief risk officer for British Caribbean Bank (BCB) Holdings, and Lyndon Guiseppi, chairman of the Belize Bank and chief executive officer of BCB Holdings, Barrow said that the Bank of America principals with whom he and his team had met in Miami on Monday had indicated that the move is due to a “business model mismatch” between the two banks.

After Thursday, April 30, 2015, Bank of America will no longer have correspondent banking relations with the Belize Bank. Barrow explained that Belize Bank will still be able to service the bulk of its clients with credit card transactions, but wire transfers for Belize Bank customers might have to be done via the Central Bank on behalf of those clients. However, Barrow added that this does not mean that the Central Bank will step into the shoes of the Belize Bank and do wire transfers for every client of the bank.

According to Barrow, Bank of America has claimed that there is a matrix of factors that resulted in their decision to sever relations with the Belize Bank, but none of those factors had anything to do with any alleged wrongdoing or irregularity by the Belize Bank.

He said that the Government will support the Belize Bank in trying to overcome this temporary setback, although he has had his difficulties with the principal shareholder of the Belize Bank – British billionaire Michael Ashcroft. Barrow noted that the Belize Bank does enjoy the largest market share in Belize, and it services a number of sectors of the economy.

According to Barrow, the Bank of America has agreed that it will deepen its relations with the Central Bank of Belize so that, if at any time in the future, there were to be any looming sign of trouble with respect to its relations with any bank in Belize, there would be better communication about the situation. He said that the Bank of America undertook to work towards ensuring that current relations with the banks in Belize will be preserved.

It is to be noted that both the domestic and international banking enterprises of the Belize Bank have lost correspondent banking relations with Bank of America.

There have also been other notable developments, in the offshore sector. Barrow said that it has been clear for a while that Belize’s offshore sector is under threat from “the big boys,” who regard Belize as one of the “harmful tax havens;” and he confirmed that Commerce Bank of Europe has also discontinued servicing the sector. Barrow said that those who work in the offshore sector say that they believe their days are numbered.

Amandala


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