Guyana blanks Republic bid to buy Scotia branches

The Central Bank of Guyana (CBG) has officially denied Republic Bank’s application for the purchase of the Bank of Nova Scotia’s (BNS) operations in the South American country.

CBG and by extension, its governor, Dr Gobin Ganga, alerted both financial institutions on the decision and its subsequent concerns. Guyana’s finance minister Winston Jordan also received correspondence from the CBG on the decision and said that the government agreed on the proposed sale it is not in the best interest of Guyana.

With the reasons for the decline revolving around competition and concentration within Guyana’s financial eco-system, Republic Bank’s president and CEO Nigel Baptiste yesterday said the development is disheartening.

“While this development is disappointing, we do not dwell on disappointment. As a group, we remain fully engaged and committed to supporting the nation of Guyana through our operations there, as well as toward ensuring the success of all activities for which we have received the requisite regulatory approvals, under the proposed BNS acquisition. We appreciate the Bank of Guyana’s acknowledgement of the value of our longstanding role in the development of Guyana’s financial landscape and our continued contribution to the financial sector,” Baptiste said in a statement to Newsday.

Republic announced its interest in acquiring Scotiabank’s operations late last year in several countries including Anguilla, Antigua and Barbuda, Dominica, Grenada, Guyana, St Kitts and Nevis, St Lucia, St Maarten and St Vincent and the Grenadines. The purchase price was cited as US$123 million, with US$25 million for the purchase of Scotiabank Anguilla and US$98 million over net asset value for operations in the remaining eight nations. St Kitts and Nevis has been the only country to approve Republic’s application and discussions for Antigua and Barbuda are still ongoing.

Republic’s share of the banking system assets in Guyana stand at 35.4 per cent and its deposits, 36.8 per cent. The purchase of BNS’s operations would see that grow to 51 per cent.