AUBYN Hill, a former senior banking executive, has accused local bankers of holding on to their risk-free mindset to the detriment of the productive sector.

Hill, who is now CEO of the Sugar Corporation of Jamaica Holdings Limited — the entity mandated by Government to manage the state-owned sugar factories — made the observation yesterday while addressing Observer reporters and editors at their weekly Monday Exchange at the newspaper’s head office in Kingston.

He noted that local cane farmers, for example, were in urgent need of financing to replenish their stock but were unable to access loans from banks.

“I have been trying to lead the banks to finance this operation based on the money that we pay for sugar and the banks have absolutely…no clue,” argued Hill.

“I’ve talked to bankers that I know and they are still in a time warp about sugar because they have been so focused on non-agriculture, non-productive things for so long, like government paper,” he said.

The former head of National Commercial Bank (NCB), however, owned up to the fact that he was also a major player in the financial sector’s risk-free investment culture when he was in banking. Hill spent two years at NCB, to which he was recruited by billionaire owner Michael Lee Chin in 2002 to turn around the then fledgling institution.

“I shouldn’t say ‘they’, it was ‘we’ because I was there; I ran the bank, it was profitable, it made sense; why should I take the risk?” acknowledged Hill, who in two years transformed NCB into a group whose profits ballooned into the billions of dollars.

But he noted that the implementation of the Jamaica Debt Exchange (JDX), which saw the Government exchange its high-interest bearing instruments for those with lower yields and longer maturities, will force bankers to diversify into different areas, which may include the productive sector.

“The JDX has brought many benefits to the country in terms of low interest rates and one of the greatest benefits is that it’s forcing bankers to look at operating businesses,” he said.

Hill said some $170 million has been made available to farmers between the SCJ, Sugar Industry Authority and the Ministry of Agriculture, but said this was still not enough to meet demand.

“The farmers are very excited about planting cane but I can tell you that they need more financing,” he said.