Following last week’s announcement by ScotiaBank of an agreement of sale of its Guyana operations to Trinidadian company First Citizens Bank Limited (FCB), the Bank of Guyana (BOG) has stated that FCB does not have a licence to operate in the country.

BOG noted that FCB published a notice in the Trinidad Guardian on its decision to enter into a purchase and sale agreement with the Scotia Bank to purchase its operations in Guyana.

However, BOG stated that the financial institution entered the said agreement without informing them prior.

“FCB does not have a licence to operate in Guyana. FCB has not submitted an application, in keeping with the requirements of the Financial Institutions Act, 1995 (FIA), to the BOG to acquire control of a bank (Scotia Bank) operating in Guyana,” the BOG said in its statement.

However, shortly after the announcement, senior minister in the Office of the President with responsibility for Finance, Dr Ashni Singh, indicated that the deal, thus far, has not received the Government’s blessings and has deemed BNS’s announcement as premature.

He said Government finds it unfortunate that the announcement was made, since Section 12 of the Financial Institutions Act (FIA) stipulates no financial institution may transfer the entire or a substantial part of its operations without prior approval from the BOG.

“Considering that the laws of Guyana require this process, we consider it premature to announce a transaction of this nature, particularly given that the regulatory process to consider the request for any such transaction is yet to be initiated, much less to be concluded,” the minister explained.

“It is the intention of the Government of Guyana and indeed, it is the intention of the regulator and the supervisor of the financial sector, that is to say the central bank, to ensure that all applicable laws are complied with in the fullest and in particular, to ensure that appropriate processes of due diligence and other processes required under the laws of Guyana are initiated and concluded before any such transaction can be proceeded with,” the senior minister argued.

Meanwhile, Scotia Bank said in its statement, that the transaction supports its strategic decision to focus on operations across its footprint where it can achieve greater scale and deliver the highest value for customers.

Scotia Bank’s current operations in Guyana encompass four branches and approximately 180 employees. Following closing, it informed all employees would continue to support the business.

The transaction, Scotia Bank said, also supports FCB’s strategic growth across the region and leverages its strengths in innovation and excellence to the benefit of all stakeholders.

Until regulatory approvals are obtained and the transaction closes, the Scotia Bank statement assured that operations in Guyana would continue as usual. In the meantime, it noted that FCB and Scotia Bank will work together to facilitate a smooth transition for the business.