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MONDAY, FEBRUARY 13, 2023
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BOB eliminates ‘external ‘Land locked’: Cable Beach influences’ of past rescue restaurant By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
BANK of The Bahamas has “eliminated a lot of the external influences” that helped produce two taxpayer-funded rescues, its top executive has revealed, with the institution “on track” to hit this year’s $8m$9m profits target. Kenrick Brathwaite, the BISX-listed lender’s managing director, told Tribune Business the root causes of its bail-outs are firmly “in the rear view mirror” as it no longer needs the $171m government bond injected into its balance sheet to remain in positive net worth territory. Bank of The Bahamas’ financials for the 2023 halfyear to end-December show it would still have net equity, albeit modest, of $3.4m even without that bond’s inclusion as an asset. Still, despite Bank of The Bahamas ‘ net income for the six-month period increasing more than ten-fold year-overyear to $4.828m, compared to just $462,323 the year
before, Mr Brathwaite said he was not yet satisfied it has achieved sustained profitability. While still awaiting Central Bank approval to re-start commercial lending, which proved the source of much of the problems that led to the past rescues under prior Boards and management, he voiced confidence that Bank of The Bahamas is “ready” to enter a market that will enable it to fully diversify its loan portfolio. And, with the entire commercial banking industry struggling for loan book
DEBT JUMPS $256M ON IMF RIGHTS BORROWINGS By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
MUCH of the $256.2m increase in the national debt during the six months to end-December was driven by the Government’s “use” of $232.3m in IMF special drawing rights (SDRs), it has been revealed. Accessing this financing, which last night drew further fire from the Opposition, helped drive the Central Bank’s share of public sector debt from 7.7 percent at end-June 2022 to 12.4 percent by year-end with SDRs doubling their
share to 3.8 percent over the same timeframe. “Reflecting recent borrowing activity of the central government, the share of SDR denominated debt rose two-fold to 3.8 percent at end-December 2022 from 1.9 percent at end-September 2022,” the Ministry of Finance’s public sector debt bulletin for the 2022-2023 fiscal year’s second quarter revealed. “Meanwhile, the Central Bank’s share of claims on the public sector advanced to 12.4 percent from 7.7 percent at end-June 2022.” SEE PAGE EIGHT
FTX CREDITORS ‘FORTUNATE’ BAHAMAS ACTED ON HACK By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
2023, hearing during which he recalled the “chaos” surrounding efforts by both his team, the Securities ComFTX’s US chief has mission of The Bahamas admitted to the Delaware and Bahamian Bankruptcy provisional Court that liquidators to clients and protect digital creditors were assets held by “fortunate” the failed crypto The Bahamas exchange from acted to safebeing stolen or guard assets lost. from theft by Blaming the hackers in a vulnerability to total reversal hackers on “a of his previous lack of integrity” JOHN RAY attacks. in FTX’s systems, John Ray perhe described formed his latest SEE PAGE FOUR u-turn during a February 6,
growth, with qualified borrowers much reduced in numbers, Mr Brathwaite said the BISX-listed institution is poised to next month “launch an aggressive strategy” to attract new mortgage, personal loan and credit card customers. And it is also “in the final stretch” of launching its first-ever debit card, which will be made available to clients in March. Bank of The Bahamas’ non-performing loans, as a percentage of its total net portfolio, still remain higher than the industry average despite falling by
more than two percentage points - from 19.49 percent at end-June 2022 to 17.12 percent - during the final six months of 2022. The latter figure remains almost ten percentage points higher than the commercial banking sector’s 2022 year-end average of 7.7 percent, but Mr Brathwaite voiced confidence that his institution’s ratio will “be in line with industry standards” by the time its 2023 financial year closes at end-June. He argued that Bank of The Bahamas’ numbers were skewed by several large loan delinquencies it is in the process of addressing. “On the commercial side of things we’ve not yet been released by the Central Bank,” the Bank of The Bahamas chief said of the continued regulatory bar to commercial lending. “We’re just waiting on them with regard to their finishing and our responses. I think really a decision may have been made; it’s just not been conveyed to us yet. They’ve already done their review.” SEE PAGE SEVEN
help backfires By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
A LANDLORD’S bid to prevent its Cable Beach restaurant tenant from becoming “landlocked and inaccessible” to customers has backfired after the Supreme Court rejected its claim to ownership of a key asset. Sir Ian Winder, the chief justice, rejected efforts by the Social House’s landlord to obtain a title certificate for the restaurant’s 7,337 square-foot parking lot and instead ruled that the Government is the rightful owner. His January 12, 2023, verdict also revealed that landlord Mortgage Holdings Ltd, a company owned by the late Heinz Wszolek’s family estate, had for several decades been paying real property
tax on a parking lot it did not own. This, though, was counter-balanced by the landlord and its various restaurant tenants having enjoyed the use of real estate the former had no right to for the same time period. The Government, via Brian Bynoe, acting surveyor-general in the Department of Lands and Surveys, and Charles Zonicle, director of physical planning, successfully argued that the Social House’s parking lot had always been reserved for the expansion of public roads and had to be kept for “future improvements”. A notice of possession, and declaration of vesting, dating from late 1977 were produced to confirm the property was owned by the Bahamas’ treasurer. SEE PAGE SIX