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TUESDAY, OCTOBER 10, 2017
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IMF urges $70m cut to civil service wages
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
T
he IMF has urged the Government to slash the civil service wage bill by almost $70 million, as it slammed the Christie administration’s “lax spending controls” pre-general election. The International Monetary Fund (IMF), in its full Article IV report on the Bahamas, revealed that the Government could save taxpayers more than $200 million annually through a combination of public service downsizing and pension reform, plus reduced
* Slams Christie’s ‘lax spending controls’ * Fund lays out $200m Budget savings map * Urges subsidy slash equal to 1.25% GDP subsidies to state-owned corporations. It recommended reducing the civil service wage bill to 2015-2016 levels “at most”, arguing that this would result in savings equivalent to 0.8 per cent of Bahamian gross domestic product (GDP). Highlighting just how bloated the public service became as the Christie administration removed all
hiring constraints in its desperate bid for re-election, an IMF graphic showed that the civil service wage bill for the 2017-2018 fiscal year equals close 8.5 per cent of GDP - compared to a 7 per cent average for the 2005-2016 period. The difference between the two is roughly $120.6 million, using the same $8.4 billion total GDP estimate that the IMF would
have employed prior to the recent near-28 per cent upward revision from the Department of Statistics. “The public sector wage bill increased sharply in fiscal year 2017,” the IMF’s Article IV report said. “Staff recommended reducing the wage bill to, at most, the level observed in fiscal year 2016, which would yield savings of 0.8 per cent of GDP—relative to
fiscal year 2018— including by reducing non-essential temporary workers (about 30-40 per cent of public employees), enacting a hiring freeze, and capping compensation for re-hired pensioners.” The IMF’s ‘0.8 per cent of GDP’ is, using the Department of Statistics’ former $8.4 billion figure,
SEE PAGE 4
CENTRAL BANK BREACHED LEGAL GOV’T BOND LIMITS By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Central Bank breached its legal limits by increasing government bond holdings to $200 million in the wake of Hurricane Matthew, the IMF has revealed. The Fund, in its full Article IV consultation report on the Bahamas, urged the Government and Central Bank to “reverse” this position and bring the latter back into compliance with statutory restrictions. The Government and Central
* IMF URGES REVERSAL FOR STATUTORY ‘COMPLIANCE’ * ‘STRICTER’ LIMITS TO BE UNVEILED BY YEAR-END * $200M MARK HIT IN MATTHEW ‘EMERGENCY’ Bank, in response, argued that the limit was only broken in extraordinary circumstances - namely to assist the Christie administration with “emergency financing” in Matthew’s wake, so that it could provide disaster relief and infrastructure repairs. They added that amendments to the Central Bank of the Bahamas Act will be introduced before year-end
2017, a move previously foreshadowed to Tribune Business by Central Bank governor, John Rolle, to impose “stricter limits” on the regulator’s government bond holdings. However, the IMF’s full Article IV report argued that reducing the Central Bank’s foreign currency debt holdings would “strengthen the credibility” of the Bahamas’ one:one exchange rate
peg with the US dollar and boost financial stability. “Following the passage of Hurricane Matthew, the Central Bank of the Bahamas increased its holdings of long-term government bonds to $200 million, about 2 per cent of GDP, breaching statutory limits. “However, Central Bank’s main target - on maintaining a level of reserves of at least 50 per
cent of the monetary base - continued to be met, albeit with smaller margins than in the past. [The IMF] noted that increases in these holdings should be reversed to ensure compliance with statutory limits.” In response, the Minnis administration and Central Bank both promised the IMF that the latter planned to reduce its holdings of government paper. “They argued that these holdings increased due to emergency financing needs of the Government,
SEE PAGE 3
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GAMING MINISTER: NATIONAL LOTTERY IS ‘FRONT AND CENTRE’ By NEIL HARTNELL Business Editor nhartnell@ tribunemedia.net THE creation of a Bahamian national lottery is “front and centre” for the Gaming Minister, who yesterday warned web shops: “The status quo needs tweaking.” Dionisio D’Aguilar declined to divulge details to Tribune Business, but said he had “a few ideas” as to how a national lottery could be structured and developed in this nation. “Bahamians are crying for that. That’s very much front and centre in my mind,” the Minister of Tourism responded, when asked by this newspaper whether a national lottery remained a possibility. Mr D’Aguilar’s remarks effectively
SEE PAGE 6
IMF: 65% bank asset BAHAMIAN fall’s ‘modest’ impact DOLLAR By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE international financial services industry’s “sharp contraction”, with total bank assets shrinking 65 per cent in the five years to 2016, has only “modestly” impacted the Bahamian economy. The International Monetary Fund’s (IMF) conclusion, which will likely surprise many in financial services and outside observers, appears based on its finding that the sector’s contribution to the wider economy has “remained broadly stable” despite the significant shrinkage. The Fund, in a separate report accompanying its Article IV assessment of
* FINANCIAL SERVICES ECONOMIC IMPACT ‘STABLE’ * DESPITE ‘SHARP CONTRACTION’ IN 5 YEARS * SMART FUNDS NOW 65% OF ALL FUNDS the Bahamian economy, said the financial services industry’s “orderly adjustment” to international regulatory initiatives had enabled it to “manage” the spillover effects for other sectors. To preserve such stability, the IMF called on the Bahamas to maintain “strong compliance” with global tax transparency and anti-money laundering demands, including the Common Reporting Standard (CRS) on automatic tax information exchange and addressing deficiencies identified in the recent
Caribbean Financial Action Task Force (CFATF) report. “Reflecting in part the impact of these global initiatives, the total assets of offshore banks in the Bahamas have shrunk significantly since 2011,” the IMF said. “Total assets of the international banks, including banks with trust licenses, declined to about $175 billion in 2016 from a peak of close to $500 billion in 2011 and the number of international banks dropped by 12.
SEE PAGE 8
‘OVER VALUED’ BY 10-20%
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Bahamian dollar is “overvalued between 10-20 per cent”, the IMF has revealed, warning that this is further eroding the economy’s cost competitiveness. The International Monetary Fund (IMF), in its full report on the Article IV consultation, found that the Bahamas’ currency was “17.6 per
SEE PAGE 7
PAGE 2, Tuesday, October 10, 2017
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WEB SHOPS: OUR KYC BEATS ALL By NATARIO MCKENZIE Business Reporter nmckenzie@ tribunemedia.net A web shop operator yesterday dismissed that the industry is a threat to the Bahamian financial services sector, arguing: “Our Know Your Customer (KYC) is bar none higher than any”. The operator, speaking on condition of anonymity, told Tribune Business: “They never even talked about us when we got blacklisted. We are a scapegoat. When things are going bad for the country, people look for a number of things to blame. “Banks around the world are closing down because it is too expensive to do KYC for international people. We cannot serve anyone else but Bahamians that have to bring in proof of identification, and proof of where there they live and they have to take pictures. Our KYC is bar none higher than any. If you compare our KYC regulations with any industry, be it insurance or banks, we are way above them.” The operator contradicted Dionisio D’Aguilar, the minister of tourism with responsibility for gaming, who recently said web shops posed a risk to the financial sector through
acting as unlicensed, unregulated money transfer businesses. And a recently-released International Monetary Fund (IMF) working paper said: “Anecdotal evidence suggests that international correspondent banks are uncomfortable providing services to domestic banks that do business with either money transmission businesses (MTBs) or online gaming operators (so called web shops), which are perceived as a higher antimoney laundering/counter terror financing risk.” As to the proliferation of web shops, and the possibility of increased taxes, the operator told Tribune Business: “We pay multiple times more than any industry in this country. We’re the highest taxed industry in the Bahamas bar none. No one yearly as much fees as we pay. “We pay $30,000 per location. The more we proliferate, the more the government collects. Why doesn’t the Government say where the fees go. We had to pay $5 million each as a penalty, and then we had to pay five years’ back taxes. We have never not paid our share in my opinion. We don’t get concessions. There is no other industry that can claim that it is 100 per cent Bahamian.”
POULTRY PRODUCER: 1,000 JOBS BOOST FROM ENDING IMPORTS By NATARIO MCKENZIE Business Reporter nmckenzie@ tribunemedia.net AN Abaco poultry producer yesterday said that eliminating imports to support local producers could boost government revenues by $33 million annually, and create 1,000 direct jobs. Lance Pinder, operations manager at Abaco Big Bird, told Tribune Business, however, that there are numerous challenges facing the agricultural sector that need to be addressed. His comments came after the minister of agriculture and marine resources, Renward Wells, last week said: “I am committed to putting in place in two years ‘no chicken imports’ into this country.” The Minister told Parliament: “It is my intention to have Bahamians eat as much of their food from locally grown sources. This would allow us to eat food that is closer to its nutritional source, which is more beneficial and has the potential to reduce our national high level of noncommunicable diseases.” Mr Wells also indicated
* BUT FARMING CHALLENGES STILL THERE * FINANCING HITS SOLAR ‘NO BRAINER’ * PRODUCER IN FIRST PROFIT SINCE 2011 his desire to increase the number of green houses producing fruits and vegetables. Mr Pinder told Tribune Business that he welcomed the Minister’s remarks, saying the vision was “possible” and “certainly ambitious”. “It would be a very good thing,” he said. “From a logistics standpoint I think it’s possible; it’s certainly ambitious. It’s always a good thing when governments talk about it, but the basic things that have impacted farming over the years are still there.” Mr Pinder stressed that such a vision would require government’s full commitment, noting that the lack of a consistent agriculture policy has been one of the sector’s main challenges. “That would require a big investment. People would need to have the confidence that government would actually implement such a ban,” he added.
CENTRAL BANK BREACHED LEGAL GOV’T BOND LIMITS
FROM PAGE 1
following the passage of Hurricane Matthew,” the Article IV report said. “They also noted that they have prepared draft amendments to the Central Bank law to introduce stricter limits on Central Bank holdings of government securities, which they intend to submit to Parliament by end-2017.” The IMF, meanwhile, also zeroed in on Bank of the Bahamas, with the Minnis administration confirming that its ultimate goal is to privatise the BISX-listed institution. The Government now owns 82 per cent of the troubled bank’s equity, and the Fund urged it to restructure Bank of the Bahamas “to isolate its business decisions from political interference”. Describing the recent transfer of $166 million worth of ‘toxic’ loans to Bahamas Resolve as “a good first step” in resolving the bank’s long-standing troubles, the IMF urged the Government to focus on developing a longer-term solution. “The recent transfer of a large fraction of nonperforming loans from the Bank of Bahamas to a special purpose vehicle (SPV) is a welcome first step,” the Article IV report said. “However, a permanent solution is still needed to reduce fiscal contingencies, which should include pursuing a resolution of non-performing loans in the SPV [Bahamas Resolve], stepping
up efforts to restructure remaining non-performing loans at the Bank of the Bahamas, strengthening the bank’s capital and liquidity, and restructuring the institution with a view to isolate its business decisions from political interference.”
The IMF said Bank of the Bahamas’ non-performing loans were equivalent to 2.5 per cent of Bahamian gross domestic product (GDP), with the bank’s loan loss reserves equal to 1.1 per cent of GDP at year-end 2016.
The latest transfer to Bahamas Resolve, it added, had removed 70 per cent of the stricken bank’s toxic loans from the balance sheet. “A permanent solution for the Bank of the Bahamas is also necessary to reduce fiscal contingencies,” the IMF reiterated.
Mr Pinder said the lack of farmers’ crop and livestock insurance, as well as s lack of available financing, were also challenges to the industry. “The local banks are not lending money. There are no financing options,” he explained. “Right now we have been looking at solarising the farm. We have less than a 4 per cent debt to income ratio with our current lender. We can’t even borrow money to solarise the farm, and it’s a no brainer.” Still, Mr Pinder said there were encouraging signs for the business, noting that the 22 year-old farm and primary Bahamian poultry producer has, for the first time in roughly six years, turned a small profit.
“We have a more positive outlook at the farm. This is the first year in about six years that the company has actually turned a small profit. “We have actually hired a few more people. Our goal is to get away from having to have government intervene on our behalf,” he added. Mr Pinder said the company is currently operating at only 80 per cent capacity, due to what he described as a “soft” Nassau market. “We did the numbers, as the government is getting $100,000 more a year in taxes out of us versus if we shut down and they just got the 30 per cent tariff on imported chicken. When someone buys a chicken from us the money stays in the country for about three weeks, versus if an imported chicken was purchased the money stays in the country about a week,” according to Mr Pinder.
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PAGE 4, Tuesday, October 10, 2017
THE TRIBUNE
IMF urges $70m cut to civil service wages FROM PAGE 1 figure, equivalent to a $67.2 million cut in the civil service wage bill. Using the Department’s revised $10.22 billion GDP, though, would result in a higher $81.76 million slash. The Fund’s recommendations and data illustrate the scale of the fiscal dilemma confronting the Minnis administration, following a week in which the Deputy Prime Minister said the 2016-2017 deficit had soared to $595 million - and counting - compared to his previous $500 million estimate. While the bloated civil service clearly needs to be reduced to a more appropriate size, cuts of the nature recommended by the IMF could have a devastating impact - both on the individuals affected and their families, plus the wider economy from the
loss of income and spending power. As a result, the Government is likely to be reluctant to cut too deeply, too quickly, and its policy approach to-date indicates it will implement a more gradual approach to reducing its wage bill by not re-hiring workers whose contracts have expired or replacing persons who have left. Still, based on austerity measures announced so far, the Minnis administration appears to be following the IMF’s Article IV report almost to ‘the letter’. The hiring freeze, reductions in temporary workers and capping remuneration for re-hired pensioners have all been implemented, along with the 10 per cent ‘across-the-board’ cut to recurrent spending. The IMF, meanwhile, also recommended that the Government could generate savings equivalent to
1.25 per cent of GDP if it also reduced subsidies to state-owned corporations back to the 2005-2016 average. To achieve this, though, it suggested that Bahamians would pay the price in other ways, namely an increase in the fees charged by state-owned enterprises (SOEs) for the services they provide. “Sizeable transfers to state-owned enterprises (SOEs)—reaching 2.1 per cent of GDP in fiscal year 2016—continue to be a drain on the budget,” the IMF’s Article IV report said. “SOEs represent also a significant contingent liability for the central government, with their combined debt reaching 18 per cent of GDP in 2016. “Reducing subsidies and transfers to the historical average would yield savings of up to 1.25 per cent of GDP relative to fiscal year 2018. To this end, staff recommended adjusting prices of services provided by SOEs to cost recovery levels, and restructuring these corporations and other public entities to improve their efficiency. A first essential step is the establishment of effective financial oversight over these corporations.” A key reason why the likes of Bahamas Power & Light (BPL) and the Water & Sewerage Corporation, for example, both lose between $20$30 million per annum is because their services are priced ‘below cost’ - meaning the prices charged to
consumers are insufficient to cover their operating costs. While following the IMF’s advice would appear to make economic sense, the Government will be alive to the political implications of forcing Bahamians to pay increased service charges as opposed to funding such losses via the taxpayer. However, the end result is that those not using services from the likes of the Water & Sewerage Corporation are subsidising those who do. Using an $8.4 billion GDP, and 1.3 per cent savings yield projected by the IMF, the Article IV report projected that following its ‘subsidy’ cut recommendation would save taxpayers $109.2 million annually. It added that subsidies and transfer payments to state-owned corporations had increased from an average of just over 6 per cent between 2006 and 2015 to around 7.25 per cent this fiscal year. The Government confirmed in the Budget that $429 million in funding had been allocated to SOEs this fiscal year. Finally, the IMF recommended that the Government require civil servants to share the burden of financing their own retirement income. This is currently borne 100 per cent by the Government, a position that is viewed as unsustainable and a ‘ticking timebomb’ for the country’s fiscal position.
“Civil servants have a non-contributory pension scheme. Pension payments have trended up to an estimated 1.1 per cent of GDP in fiscal year 2017, and population aging will increase them further,” the IMF warned. “Staff recommended transforming the civil servants’ pension system into a contributory regime in the near term, with contributions commensurate with benefits, and with a view to move to a definedcontribution scheme in the medium term. Setting contributions at 5 per cent of wages for pensionable employees could yield revenues for 0.3 per cent of GDP.” The saving would be equivalent to $25.2 million per annum, based on an $8.4 billion GDP and the IMF’s figures. The KPMG accounting firm previously estimated the unfunded, ‘pay-as-you-go’, civil service pension liabilities at around $1.5 billion. These liabilities are set to increase to $2.5 billion by 2022, and $4.1 billion by 2032, unless reforms are enacted. Collectively, the three reforms cited by the IMF a reduced civil service wage bill, lower subsidies and contributory civil service pension reforms - would save Bahamian taxpayers a total $201.6 million per annum, significantly narrowing the fiscal deficit. It argued that the three initiatives would enable the Minnis administration to meet its deficit reduction targets, and help contain
its recurrent or fixed-cost spending. The Fund also warned that its objective of reducing the deficit to $323 million, or 3.5 per cent of GDP, for 2017-2018, followed by further falls to 2.3 per cent and 1.1 per cent in subsequent years, were “more optimistic” than its own forecasts. “Staff projects [direct government] debt to peak at 73.3 per cent of GDP in fiscal year 2018, reflecting the impact of [Hurricane Matthew] and lax expenditure control before the general elections in May, and only to fall by half a percentage point over the medium term under modest consolidation efforts,” the IMF said. “Under modest consolidation efforts, which would bring the fiscal deficit down to about 2.25 per cent of GDP in the medium term, the debt would only stabilize at around 73 per cent of GDP in 2022. “This baseline scenario assumes dissipation of hurricane-related spending and expiration of temporary tax relief measures, restraints in current expenditure, and revenue increases from ongoing efforts to improve tax administration and collection. “There are significant downside risks to the fiscal outlook, with a combination of adverse shocks putting the debt on an upward trajectory. The debt sustainability heat map points to moderate to high risks to debt sustainability.”
THE TRIBUNE
Tuesday, October 10, 2017, PAGE 5
HOTEL ASSOCIATION ‘THINK TANKS’ OVER GB REVIVAL THE Bahamas Hotel & Tourism Association’s (BHTA) October Board of Directors and members’ meeting became a ‘think tank’ on how to rapidly revive Grand Bahama. Attendees discussed how Grand Bahama could capitalise on “low hanging fruits” to help stimulate new markets, and boost the destination’s visitor numbers. Targeting growing marina ports, such as Stuart, Florida, to attract sea-faring visitors; stay vacation packages for Bahamians living in New Providence; and welcoming business that may be unable to travel to regions in the Caribbean due to recent hurricanes were among the short-term options debated. Carlton Russell, the BHTA’s president, said: “We were so pleased to be given the opportunity to visit Grand Bahama once again. This incredible island, with its diverse offerings, stellar infrastructure, its proximity to the US and, most importantly, its proud and talented Grand Bahamian residents, is a jewel that needs only a polish and the perfect setting atop a befitting band of gold, to be considered one
FROM L to R back row: Magnus Alnebeck, general manager, Pelican Bay; Ellison ‘Tommy’ Thompson, deputy-director general, Ministry of Tourism; Diego Giribaldi, general manager, Viva Fortuna; Desmond Keefe, executive director, culinary arts and tourism studies, University of the Bahamas; Basil Smith, BHTA chairperson for the Association of Bahamas Marinas (ABM) and executive director, ABM; Rembert Albury, executive vice-president, GBITB; Stephen Kappeler, president of the ABM; Hadley Forbes, H Forbes Charter; Dean Spychalla, senior vice-president, BHTA, and president of the Bahama Out Islands Promotion Board (BOIPB); Jamal Glover, treasurer, BHTA; Kerry Fountain, executive director, BOIPB; Ian Rolle, president, Grand Bahama Port Authority./ (L to R front row): Pastor Lockhart, Calvary Temple Church; Carmel Churchill, director of marketing services, GBITB; Meshell Britton, manager, GBITB; Karen Seymour, director, Ministry of Tourism, GBI; Erica Gates, proprietor Grand Bahama Nature Tours; Veronica Clarke, resort manager, Grand Lucayan; Jackie Carroll, BHTA, vice-president for Grand Bahama and general manager, Old Bahama Bay; Vernice Walkine, vice-president, BHTA Allied Members, and NAD president and chief executive; Suzanne Pattusch, executive vice-president, BHTA; and Carlton Russell, BHTA president. of the finest islands in our archipelagic nation.” He added: “It was very important for the BHTA
to meet with industry partners and members in Grand Bahama. We look forward to continuing to nurture our
synergies. “Our association is known as the Bahamas Hotel and Tourism Association for a reason because
we represent the entire country. “We are committed to doing our part to ensure
Grand Bahama reaches her potential as a key participant and influencer in the tourism industry.”
Account limits best game for regulators NOTICE
NOTICE is hereby given that JOHN JOSEPH MATHIEU of Marsh Harbour, Abaco, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/ naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 3RD day of October, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
NOTICE
NOTICE is hereby given that SILVENIE CEUS of Summerset Estates, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/ naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 10th day of October, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
NOTICE
NOTICE is hereby given that CAVALL OBILE DANIEL ANTON WATSON of P.O. Box SS-19850, Clarke Lane off Mackey Street, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/ naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 2nd day of October, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
NOTICE
NOTICE is hereby given that CAVILLE OBILLE DUNIEL AMTON WATSON of P.O. Box SS-19850, Faith Gardens and Collins Drive, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/ naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 2nd day of October, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
NOTICE
NOTICE is hereby given that TINA SHAE ANTONEA HERON-WATSON of P.O. Box SS-19850, Faith Gardens and Collins Drive, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/ naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 2nd day of October, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
NOTICE
NOTICE is hereby given that CADADI OBI DECOURCEY ANOAH WILLIS of P.O. Box SS-19850, Clarke Lane off Mackey Street, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/ naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 2nd day of October, 2017 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
Dear Sir, With a Gaming Board of four private individuals, and six Government civil servants, as published on July 26, 2017, on Page 8 of your newspaper, it seems that the Board as well as the Minister need educating on the effects of the gambling laws in this country. The Minister, whose portfolio includes gaming, is concerned, quite rightly, with the effects an addiction to gambling is having in this country, as mentioned in the newspaper headlines. A limit should be placed on all
customers, and if the KYC and regulators can’t deal with this, then they must be made to apply such limits. Each account can be given a monthly limit depending on the person’s income. For many years, Bahamians were prevented from gambling in the casinos. Now, Internet gambling has swept the world. A National Lottery and a new Gaming Act came into existence in Great Britain, which restrict participants to UK residents, who must also be citizens. Therefore, this money stays in the
country, whether as government taxes, service fees to the operators of the lottery, or to prize winners. I understand that legislation should include a provision that at least a minimum of ‘x’ per cent is set aside for prizes, and must be paid out to winners within 12 months of the lottery’s monthly draw. The economic benefits to the Government can be seen on the excellent Lottery web page, which you can ‘google’ at UK National Lottery. As much as £160
million seems to be collected every draw. As the original vote in our Parliament made allowances for a National Lottery, surely the benefits of competition and transparency, and a professional private sector manager, would help address the concern that we now have a ‘cartel’ and a monopoly. At least the Government would spend money collected in the interests of all Bahamians. CONCERNED TAXPAYER October 9, 2017
MARKET REPORT FRIDAY, 6 OCTOBER 2017
t. 242.323.2330 | f. 242.323.2320 | www.bisxbahamas.com
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BAH29 BG0103 BG0203 BG0105 BG0205 BG0107 BG0207 BG0130 BG0230 BG0303 BG0305 BG0307 BG0330 BG0403 BG0405 BG0407
BAHAMAS GOVERNMENT STOCK - (percentage pricing) 115.92 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
104.79 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
MUTUAL FUNDS 52WK HI 2.09 3.96 1.97 170.77 146.34 1.50 1.67 1.58 1.10 6.99 8.54 6.15 10.52 11.46 10.46
52WK LOW 1.67 3.04 1.68 164.74 116.70 1.44 1.63 1.55 1.04 6.41 7.62 5.66 8.65 10.54 9.57
LAST CLOSE 4.28 17.43 9.09 3.65 1.26 0.15 3.92 8.60 6.10 3.83 10.01 2.59 1.40 6.00 9.75 7.08 3.59 7.01 12.50 10.00 1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00 LAST SALE 100.00 100.00 100.00 109.53 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
CLOSE 4.28 17.43 9.09 3.65 1.26 0.15 3.92 8.60 6.10 3.83 10.01 2.59 1.40 6.00 9.75 7.08 3.75 7.01 12.50 10.00
CHANGE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.16 0.00 0.00 0.00
1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
CLOSE 100.00 100.00 100.00
CHANGE 0.00 0.00 0.00
109.53 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
FUND CFAL Bond Fund CFAL Balanced Fund CFAL Money Market Fund CFAL Global Bond Fund CFAL Global Equity Fund FG Financial Preferred Income Fund FG Financial Growth Fund FG Financial Diversified Fund FG Financial Global USD Bond Fund Royal Fidelity Bahamas Opportunities Fund - Secured Balanced Fund Royal Fidelity Bahamas Opportunities Fund - Targeted Equity Fund Royal Fidelity Bahamas Opportunities Fund - Prime Income Fund Royal Fidelity Int'l Fund - Equities Sub Fund Royal Fidelity Int'l Fund - High Yield Fund Royal Fidelity Int'l Fund - Alternative Strategies Fund
VOLUME 100
26,200
1,000
VOLUME
82 NAV 2.09 3.95 1.97 174.30 146.25 1.50 1.63 1.58 1.08 6.92 8.03 6.15 10.52 11.46 10.01
EPS$ 0.444 0.932 -0.223 0.540 -1.373 0.000 -0.857 0.611 0.574 0.562 0.582 0.102 0.392 1.217 0.743 0.575 0.310 -0.668 0.543 0.000
DIV$ 0.080 1.000 0.000 0.210 0.000 0.000 0.000 0.300 0.220 0.360 0.570 0.060 0.050 0.290 0.450 0.000 0.113 0.140 0.600 0.000
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
P/E 9.6 18.7 N/M 6.8 N/M N/M -4.6 14.1 10.6 6.8 17.2 25.4 3.6 4.9 13.1 12.3 12.1 -10.5 23.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0.00% 0.00% 0.00% 0.00% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 7.00% 6.50%
INTEREST 7.00% 6.00% Prime + 1.75%
MATURITY 19-Oct-2017 31-May-2018 19-Oct-2022
6.95% 4.00% 4.00% 4.25% 4.25% 4.50% 4.50% 6.25% 6.25% 4.00% 4.25% 4.50% 6.25% 3.50% 3.88% 4.25%
20-Nov-2029 15-Dec-2017 30-Jul-2018 16-Dec-2019 30-Jul-2020 15-Dec-2021 30-Jul-2022 15-Dec-2044 30-Jul-2045 26-Jun-2018 26-Jun-2020 26-Jun-2022 26-Jun-2045 15-Oct-2018 15-Oct-2020 15-Oct-2022
YTD% 12 MTH% 2.92% 4.43% 0.98% 1.19% 1.54% 2.45% 3.48% 4.01% 3.17% 7.00% 2.15% 4.22% -1.93% -1.89% 0.81% 2.21% 2.28% 1.30% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69%
NAV Date 31-Aug-2017 31-Aug-2017 25-Aug-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 30-Jun-2017 31-May-2017 30-May-2017 30-May-2017 30-May-2017 30-May-2017 30-May-2017
MARKET TERMS BISX ALL SHARE INDEX - 19 Dec 02 = 1,000.00 52wk-Hi - Highest closing price in last 52 weeks 52wk-Low - Lowest closing price in last 52 weeks Previous Close - Previous day's weighted price for daily volume Today's Close - Current day's weighted price for daily volume Change - Change in closing price from day to day Daily Vol. - Number of total shares traded today DIV $ - Dividends per share paid in the last 12 months P/E - Closing price divided by the last 12 month earnings
YIELD 1.87% 5.74% 0.00% 5.75% 0.00% 0.00% 0.00% 3.49% 3.61% 9.40% 5.69% 2.32% 3.57% 4.83% 4.62% 0.00% 3.01% 2.00% 4.80% 0.00%
YIELD - last 12 month dividends divided by closing price Bid $ - Buying price of Colina and Fidelity Ask $ - Selling price of Colina and fidelity Last Price - Last traded over-the-counter price Weekly Vol. - Trading volume of the prior week EPS $ - A company's reported earnings per share for the last 12 mths NAV - Net Asset Value N/M - Not Meaningful
TO TRADE CALL: CFAL 242-502-7010 | ROYALFIDELITY 242-356-7764 | FG CAPITAL MARKETS 242-396-4000 | COLONIAL 242-502-7525 | LENO 242-396-3225
PAGE 6, Tuesday, October 10, 2017
THE TRIBUNE
Gaming Minister: National lottery is ‘front and centre’ FROM PAGE 1 opened up a new front in his ongoing battle with the numbers houses, given that many - both inside and outside the industry - believed a national lottery had been ‘removed from the table’, and was not a subject for discussion, when the industry was ‘legalised’. With the web shops scooping up all domestic gambling proceeds, it was felt there would be insufficient appetite and income to fund a national lottery, and the former Christie administration dropped the idea. However, national and state lotteries in nations such as the US and UK have raised millions of dollars for charities and good causes, and provided significant funding for projects that benefit society. The national lottery topic arose as Mr D’Aguilar effectively ‘doubled down’ on concerns he raised in Parliament last week, arguing that the web shops’ efforts to compare themselves to hotel casinos “shouldn’t be taken seriously”. While resorts such as Atlantis and Baha Mar generated billions of dollars in GDP impact and foreign exchange earnings, the Minister said the gaming houses were wealth redistributors rather than creators - taking money from many, with the profits reaped by relatively few. Pointing out that the proliferation of web shop gaming was imposing a huge social cost on Bahamian communities via gambling addictions, Mr D’Aguilar suggested it should be viewed like alcohol and cigarettes, and subjected to ‘sin’ or ‘vice’ taxes. The Minister also suggested the sector’s Know Your Customer (KYC) processes were deficient, set alongside its functioning as a money transfer business, because a client’s sources of income were not verified. And Mr D’Aguilar, defending his description of the sector as a ‘cartel’, said the 10-year moratorium
* SAYS ‘BAHAMIANS CRYING’ FOR MOVE * DOUBLES DOWN ON WEB SHOP CONCERNS * CASINO COMPARISON ‘CAN’T BE TAKEN SERIOUSLY’ barring new entrants was ‘hypocritical’ given that the web shop operators have been using their profits to expand into other sectors of the economy where there are no such obstacles. “My position is the status quo, in the eyes of many, including the Government, needs tweaking. It warrants a discussion,” Mr D’Aguilar told Tribune Business. “They’re [the web shops] very happy because they’re making oodles of money. “If I had a business making oodles of money, and some whipper snapper like D’Aguilar turns up and says the nature of the profits being generated by the industry for the benefit of so few, at the expense of so many, is generating too high a social cost and there needs to be a rebalancing, I might be unhappy, too.” Emphasising that he would not back down, despite intense push back from the Gaming House Operators Association last week, Mr D’Aguilar said a review of the sector was likely to “crystallise” prior to next year’s Budget. “This whole industry has been shrouded in a certain element of secrecy,” he added. “We’ve got to have discussions and see where it’s going to go. “Don’t confuse the theatre of Parliament with the need to get specific results and specific improvements. The status quo is not perfect, and we need to tweak it.” Gaming house operators are currently required to pay 11 per cent of their taxable revenue or 25 per cent of earnings before interest, taxes, depreciation and amortisation (EBITDA), depending on which one is greater. They also pay 2 per cent of their revenues to charitable causes and entities, which generated the Association’s argument last week that its effective tax
rate is 13 per cent, when hotel-based casinos pay just 5 per cent and also enjoy significant tax incentives. Mr D’Aguilar, though, argued that the comparison was disingenuous and like matching “apples with oranges”. He added: “This comparison with the established casinos is, in my opinion, completely flawed because the casinos are governed by a Heads of Agreement. “They get a favourable tax rate because they make, in most instances, many billions of dollars in investments and create thousands of jobs - 8,000 at Atlantis, and 5,000 at Baha Mar. “Clearly, the GDP effect of those hotels is far more substantial and far more positive than those numbers houses. They don’t have nearly the GDP effect to compare themselves to an investment like Atlantis and Baha Mar, in my humble opinion,” the Minister continued. “The comparison’s completely flawed, and not to be taken seriously. Yes, they pay a higher rate, but over the GDP impact, economic effect and creation of high-paying jobs, there’s no comparisons.” Mr D’Aguilar said the proliferation of web shops throughout the Bahamas, and easy access to gambling, had created a growing addiction problem - especially in the Family Islands. “We need to come up with a mechanism to try and limit the damaging effects from many, many people blowing their weekly or monthly wages on gambling,” he added. “Certainly, in the Family Islands it’s been devastating. The MP for Long Island pulled me aside and told me there are many, many numbers houses in Long Island, and it seems it’s having a tremendous effect on the social fabric of the island. People are addicted.”
Acknowledging that he backed the web shop industry’s legalisation, Mr D’Aguilar suggested he had the Bahamian people’s support for the imposition of more controls on the sector. “It’s not just about taxation; it’s about how we lessen the impact of this vice,” he said. “I think a lot of people are clamouring for a bit more regulation, and a bit more control, over the sector. “It seems as if they’re building these huge gaming houses, everywhere you look there’s a numbers house, and it’s beginning to affect the working mind of the people; why work when you can gamble? As a government, we have to be aware a bit more of the impact of this vice. Everywhere you look it’s a free-for-all, there’s unimpeded access and we’re losing our minds.” The Gaming House Operators Association last week said its members applied the most stringent KYC due diligence in the financial sector, after Mr D’Aguilar raised concerns that they could attract the ire of global regulators by acting as unlicensed, unregulated money transmission businesses. The Minister responded yesterday, though, that while web shops required government-issued identification and utility bills from customers, they did not verify income sources. This, he added, was why the Central Bank was concerned and the issue “needs addressing”, especially as “anyone can put money on an account and someone can take that off an account”.
And while the word ‘cartel’ had negative connotations, Mr D’Aguilar maintained that the 10-year moratorium granted to the existing eight web shop license holders meant this description was accurate, as there can be no new entrants until 2027. “They have no competition; the law is protecting them,” he told Tribune Business. “The law is saying no one can enter into that business, and the profits are substantial. They’ve got a guaranteed revenue stream for 10 years, and market share. “We should review that. They don’t ever have to worry about competition in their core market, because no one else can enter, but they can enter into other markets and compete with everyone else there.”
Island Luck and its principal, Sebas Bastian, have already done exactly that by entering the real estate and construction markets with Brickell Management Group and Vandoff Construction, plus securities and investment banking with Investar Securities. Mr D’Aguilar, meanwhile, suggested that the web shop industry is “already dominated by one” player as it consolidates, with a number of operators sharing a common gaming platform provided by one house. “I haven’t looked into it, but I’m told there’s common ownership at a number of houses,” the Minister added. “I don’t think that was supposed to be... the licenses were supposed to have been open to other people.”
NOTICE Re: Supreme Court Equity Action No. 00615 of 2017 The Petition of Grico Company Limited in respect of ALL THOSE lots of land known as and called lots Nos. 3, 5 and 11 of Conquest Subdivision immediately south of Sandilands Village Road and being a portion of a Crown Grant to the late Thomas Bertie Davis and being about 2,280 ft. west of Fox Hill Road which said lots are respectively 6,470 sg. ft., 6,663 sg. ft. and 6,818 sq. ft which said lots are fully described by the plan lodged at the Department of Lands and Surveys as No. 5077NP and filed in this action and are thereon coloured Pink. Grico Company Limited claims to be the legal and beneficial owner in fee simple in possession of the said lots hereinbefore described and Grico Co. Ltd. has made application to the Supreme Court under Section 3 of the Quieting Titles Act, 1959, to have its title to the said land investigated. Copies of the filed plan may be inspected during normal working hours at:a) The Registry of the Supreme Court, British American Building, Marlborough and George Streets, Nassau, N. P., Bahamas; or b) The Chambers of Martin, Martin and Co., Vet CF Place, Eight Terrace East, Nassau, Bahamas (ph:698-4708). NOTICE IS HEREBY GIVEN that any person having dower or right to dower or any adverse claim or claim not recognised in the Petition shall on or before the 24th. day of October, A. D. 2017, file in the Registry of the Supreme Court and serve on the Petitioner or the undersigned a statement of such claim in the prescribed form and verified by an affidavit to be filed therewith. Failure of any such person to file and serve a statement of such claim on or before the 24th. day of October, A. D. 2017, will operate as a bar to such claim. Martin, Martin And Co. Attorneys for the Petitioner
THE TRIBUNE
Tuesday, October 10, 2017, PAGE 7
BAHAMIAN DOLLAR ‘OVER VALUED’ BY 10-20% FROM PAGE 1 cent stronger than the level deemed consistent with fundamentals and desired policies” on a real effective exchange rate (REER) basis. This strips away the one:one peg with the US dollar, and measures the Bahamian dollar’s value against a basket of other currencies adjusted for inflation, to determine its competitiveness. The IMF said its analysis, suggesting the Bahamian currency was overvalued, had major implications for the competitiveness of an economy still struggling with structural impediments such as high energy costs/ unreliability and bureaucratic bottlenecks facing the private sector in its dealings with government. While the Bahamas’ reliance on US tourists had helped to mitigate the dollar’s appreciation via the peg, the Fund warned it was exacerbating a situation where real wages are growing faster than productivity. “The currency appreciated 11.25 per cent in real effective terms on average between 2014 and 2015, reflecting a strengthening of the US dollar and, to a lesser extent, the introduction of the VAT in January 2015,” the IMF report said. “Since 2015, the real effective exchange rate (REER) has remained virtually flat. In staff’s view, the currency is overvalued between 10 and 20 per cent. The introduction of the VAT in early 2015 was a factor accounting for about two percentage points of the strengthening of the REER” The Fund said the Bahamian dollar’s attachment to its appreciating US counterpart had implications for efforts to diversify tourism source markets, as this made vacations to this nation relatively more expensive for Canadians, Europeans and others. “From a cost perspective, the Bahamas is among the most expensive tourism destinations and its share in the ‘exclusive’ Caribbean tourism market has
been declining,” the IMF added. “The strength of the currency in real effective terms, and real wages growing faster than productivity, have further eroded competitiveness. “Overall, staff assess the REER to be overvalued by around 9 to 18 per cent in 2016. The model finds that the REER is 17.6 per cent stronger in 2016 than the level deemed consistent with fundamentals and desired policies..... The current level of the REER is around 11 per cent higher than the long-term average.” The IMF said the currency overvaluation, and tie to the US dollar, gave the Bahamas less flexibility than Caribbean tourism rivals such as Jamaica and the Dominican Republic, both of which do not have fixed exchange rate regimes. It added that while the Bahamas’ foreign currency reserves of $904 million at year-end 2016 were below the international benchmark of three months’ worth of imports, standing at 2.4 months’ worth, they were above 100 per cent of the country’s short-term debt. On a more positive note, the IMF is forecasting that the Bahamas’ ‘negative credit gap’ will gradually be closed as bank lending to the private sector picks up to an annual 2.5-3 per cent growth rate by 2021-2022. However, it revealed that bank ‘spreads’ - the difference between lending and deposit rates - are currently “much higher” than before the 2007-2009 recession due to a lack of economic growth and difficulties in assessing borrower creditworthiness. “Banks have maintained a cautious lending attitude, particularly as the lack of a credit bureau and of a wellestablished book-keeping tradition have made it difficult to assess borrowers’ creditworthiness,” the IMF said. “These challenges have led banks to increase the risk premium on new lending, bringing intermediation spreads to levels much
higher than those seen before the global financial crisis. Consequently, the total stock of credit to the private sector has remained flat, leading to a negative credit gap.” This gap was assessed as equivalent to 2 per cent of GDP (around $200 million) in 2016. The IMF urged the Bahamas to “reverse the self-reinforcing negative feedback loop” created by the lack of GDP growth, and high levels of loan delinquency, on credit supply. It said the enactment of legislation to create a Credit Bureau is also essential to this effort. The Article IV report also exposes why the 20082009 recession hit the Bahamas, and so many families, especially hard as it revealed the high level of household indebtedness and “explosion” in reckless bank lending prior to the crash. “Households have not been able to fully repair their balance sheets following the sharp economic contraction during the global financial crisis, which turned many loans non-performing,” the IMF said. “Bank household debt increased from about 40 per cent of GDP in 2005 to a peak of 62 per cent of GDP in 2011, declining only to 57 per cent of GDP in 2016.” It continued: “Total credit grew at an average annual rate of 10 per cent over 2002-2008. The expansion was particularly pronounced in household credit, with residential mortgage lending and consumer credit growing at average annual rates of 20 and 9 per cent, respectively. “Business lending, with only a small fraction going into commercial mortgages, expanded only modestly at average annual rates of 3 per cent, although it temporarily accelerated to slightly above 10 per cent in 2005 and 2006. The rapid acceleration in household credit led to a significant increase in household leverage: household debt (mortgages and consumer loans) increased from 37 per cent of GDP in 2002 to 58 per cent in 2008.”
www.ub.edu.bs
VACANCIES Suitably qualified candidates are invited to submit applications for the following positions at University of The Bahamas.
MIDDLE MANAGEMENT Executive Director, Small Business Development Centre responsible for implementing a Small Business Development Centre Model in The Bahamas based on a Memorandum of Understanding signed between the Government of The Bahamas through the Ministry of Finance and the Organization of American States. The Executive Director will provide strategic and operational leadership; design, promote and deliver training, outreach programmes and support for small and medium-sized business owners; liaise with UB internal and external stakeholders; plan and develop budgets, monitor expenditures and operations and provide oversight for the UB Oakes Field Campus and UB-North Small Business Development Centres. The preferred applicant will possess an earned Ph.D. in business from an accredited academic institution with two to three years teaching and relevant industry experience in the small to medium sized business sector. The minimum education and experience requirements are a Master’s degree in business or a related field with five to ten years’ strong administrative experience providing support and training for small and medium-sized businesses. Previous business ownership is desirable. Materials should be submitted electronically to the attention of the Office of the Provost, University of The Bahamas via e-mail at facultyapply@ub.edu.bs. Forward all documents together, including: 1) cover letter describing philosophy and vision; 2) curriculum vitae; 3) official copy of all academic records; 4) three letters of recommendation; and 5) a UB application form accessible at: http://www.ub.edu.bs/wp-content/uploads/2016/10/UB-Application-forEmployment-Faculty.pdf . Application deadline: Monday, 16th October 2017. Clinical Psychologist responsible for the psychological assessment, diagnosis, counselling, individual and group therapy, case management services, referral, testing and evaluation of students and maintaining a warm, friendly and supportive environment for students, staff and faculty. Further duties and responsibilities include: developing, implementing, and monitoring psychological services; conducting interviews, psychological assessments and observations of individuals and groups; liaising with other health and social services personnel, from a range of agencies, in the care provided to clients and planning and undertaking clinical audits, service evaluations or practice-based research, using appropriate methodology and statistical procedures as appropriate. Applicants must possess a doctorate in Clinical Psychology or Educational Psychology. Possession of Psychologist license is preferred or meets licensure requirements. Application deadline: Friday, 13th October 2017. Assistant Director, Residential Life & Student Advocacy Services UB-North (in Grand Bahama) responsible for the management and coordination of the new residential facility towards creating a highly effective and engaging residence hall environment. The Assistant Director will also be responsible for developing and administering programmes and services to support the personal, social, and emotional well-being of students as they progress towards attaining their education at UB-North. Among the duties are: supervising and developing the Resident Assistants programme including selection, recruitment and training; serving as student conduct administrator, conflict mediator and providing intervention counseling to campus residents; assessing University housing occupancy, retention, and projection trends and developing a comprehensive programme that supports the social and emotional well-being of students. Applicants must have a Master’s degree in higher education administration, counseling, physical education, or a related field; supplemented with five (5) years of related experience in increasingly advanced supervisory roles in student leadership and youth programming and development AND must have or be able to attain AED, CPR and First-Aid certifications through a nationally recognized organization. Application deadline: Friday, 13th October 2017. responsible for creating and Disabilities and Compliance Officer maintaining a safe, inclusive and supportive environment for all students with disabilities; providing leadership and administrative management to the Students with Disabilities Unit and advocating for students with disabilities to ensure that they have equal access to all programmes, services and activities that the University provides. Further duties and responsibilities include: ensuring compliance with University policies on disabilities; liaising with the business community, government ministries, boards and agencies on matters pertaining to students with disabilities; developing policies and procedures that promote disability inclusion and universal design in programmes, services and facilities and writing grant proposals to receive funding for initiatives that support the creation of more usable, inclusive and sustainable learning environments for students with disabilities. Applicants with a Master’s degree from an accredited university in Rehabilitation Counselling, Special Education or related field, or Bachelor’s Degree in Management, Public Administration, Rehabilitation or related field WITH a minimum of 2 years’ experience and/or training in disability studies, disability policies and services, disability compliance or closely related fields. Application deadline: Friday, 13th October 2017.
STAFF Administrative Assistant II, Student Affairs UB-North (in Grand Bahama) responsible for providing administrative support for the Division of Student Affairs’ administration team. The Administrative Assistant will play a key role in supporting the pioneering work of developing the division of Student Affairs at UB-North and will provide direct support to the Dean of Students and Student Affairs personnel. Duties include: managing the Dean of Students’ calendar and schedule, prioritizing appointments and proactively resolving conflicts; assisting with the general oversight and management of all division budgets in collaboration with department heads and in preparation for annual budget proposals; completing special projects and other duties as assigned and reviewing all incoming and outgoing documents for the Dean of Students’ signature to ensure compliance with divisional and university guidelines. Applicants must possess a Bachelor’s degree in Business Administration or the equivalent, AND at least four (4) years’ post-qualification work experience. Application deadline: Friday, 13th October 2017. Administrative Assistant I responsible for assisting the Director of Student Leadership with the overall day-to-day management of the office and campus relations. Duties include: assisting with the planning of Student Leadership events; attending meetings and taking notes of discussions held and decisions made for distribution to relevant persons; undertaking research and/or follow-up activities, providing administrative support related to special projects; maintaining an accurate filing system and assisting in the coordination of fundraising activities. A Bachelor’s Degree or the equivalent with no work experience, or an Associate Degree in relevant area with ten (10) years’ work experience is required. Application deadline: Friday, 13th October 2017. For more information on each position announcement visit: https://www.ub.edu.bs/about-us/career-opportunities/ . Persons interested in any of these positions should submit to the attention of the Vice President, Human Resources, University of The Bahamas, via email the following documents: • A completed University of The Bahamas Application for Employment; • A cover letter of interest highlighting work experience and accomplishments relevant to the position; • Current Curriculum Vitae or Resume; • Copies of Relevant Qualifications and Certificates; • Copy of the relevant pages of a valid passport showing passport number, photo identification and expiration date; • Copy of N.I.B Card; • One passport photo; • Copy of official transcript • At least three, written professional references
PAGE 8, Tuesday, October 10, 2017
THE TRIBUNE
IMF: 65% bank asset fall’s ‘modest’ impact FROM PAGE 1 “US banks bore the brunt of the decline in assets. In 2016, 11 mergers and acquisitions took place in the offshore banking sector, and some European private banks withdrew from the market.” Thus the IMF paper illustrates how global developments, both regulatory and commercial, have driven consolidation in the Bahamian financial services industry since the turn of the century, which was marked by the now-infamous Financial Action Task Force (FATF) ‘blacklisting’.
“SOME BANKS ALSO OUTSOURCED VARIOUS BUSINESS FUNCTIONS TO ACHIEVE OPERATIONAL EFFICIENCIES AND SYNERGIES WITHIN THEIR GROUPS. DURING 2016, THE CENTRAL BANK OF THE BAHAMAS APPROVED 25 OUTSOURCING ARRANGEMENTS.” It also indicated how the nature of private banking/ private wealth management has changed, with niche, boutique firms picking up business as larger institutions exit the segment in readjusting their business models. “Some large banks have adapted to the new regulatory environment by shifting activities away from private banking/ wealth management,” the IMF said. “Based on
the Central Bank [of the Bahamas] analysis, the imposition of tax amnesties in other countries has resulted in a sizable reduction in the overall assets under management (AUM) in the Bahamas, as many clients have taken the opportunity to become tax compliant with their home countries. “Large banks have increased their investment banking activities, and moved away from trust
and private banking/wealth management, with small banks still focused on private banking. Among the top 10 banks, four concentrate in investment banking, with only the two largest banks offering corporate banking and private banking businesses. “Some banks also outsourced various business functions to achieve operational efficiencies and synergies within their groups. During 2016, the Central Bank of the Bahamas approved 25 outsourcing arrangements.” The IMF added that private wealth management had also become much more personalised, as high net worth individuals and their families sought specific products and focused attention from the likes of family offices and private trust companies. The SMART fund, which effectively transforms
investment funds into private wealth management tools, now accounts for 65 per cent of the 920 investment funds domiciled in the Bahamas. They grew in number by 92.9 per cent, almost doubling between 2011 and 2015, as they rose from 296 to 511. Analysing the financial services industry’s impact through a combination of jobs, tax revenues and local purchases of goods and services, the IMF said the sector generated domestic demand equivalent to 3 per cent of GDP. “The overall direct contribution has remained broadly stable over the last 10 years, as the bulk of it originates from the relatively stable local expenses and employment, which are not sensitive to the asset size of the system,” the IMF said. “An increase in fees paid to the Government— which are based on the
size of assets—since 2012 helped increase government revenues from these fees despite a decline in the size of assets in the system.” The IMF’s economic impact assessment numbers are startlingly low compared to the industry’s own estimates, which project that financial services could account for as much as 25-30 per cent of Bahamian GDP. The Fund’s paper acknowledged this, agreeing that the industry’s total economic contribution was likely to be higher, especially given that other studies had pegged this at 9 per cent of GDP. “The offshore financial centre’s direct contribution to the real economy in the Bahamas appears to have remained broadly stable despite a significant decline in its size,” the IMF said. “An orderly adjustment of the sector to global regulatory initiatives has contributed so far to manageable direct effects on the real economy, although it is difficult to determine the full extent of the impact— including spillovers.” But many Bahamians, especially those who work in the financial services industry and associated professions, are unlikely to recognise the scenario outlined by the IMF and its conclusions. For the sector has shrunk significantly since the ‘blacklisting’ and enforced regulatory changes of 2000, as business exited the Bahamas, along with multiple institutions and financial services providers. Defenders of the reforms will argue that they removed ‘marginal’ players, leaving only ‘blue chip’, quality business remaining, but the financial services industry has struggled ever since to provide the necessary growth and highpaying professional jobs that the Bahamas demands. Still, the IMF ranked the Bahamas as the fourth largest international financial centre (IFC) in the world, after Hong Kong, Singapore and Cayman, based on cross-border asset data. Its total assets were said to be $332 billion at year-end 2016, with the Bahamas’ 10 largest banks accounting for almost 80 per cent of that segment’s $175 billion assets. Bahamas-domiciled investment funds hold another $132 billion in assets.