The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

COMMERCIAL banks should not be viewed as employment centres, the Central Bank's governor instead arguing that the job creation focus must be placed on the international sector.

John Rolle, addressing the Rotary Club of East Nassau, said Bahamas-based banks must become more efficient or consumers will continue to bear the burden of high fees.

"In the Bahamas we have to find a way to make our banks more efficient in the way they operate, otherwise we are going to continue to have to pay the cost," Mr Rolle said. "We can debate whether the costs are reasonable or not, but we will continue to pay costs and, in some cases, may see costs go up. We have to put more effort into understanding why the environment is as costly as it is, and that the labour conditions are not as hospitable for the banks."

In recent years Canadian banks, the Royal Bank of Canada, Scotiabank and CIBC First Caribbean, have all moved to cut operating costs and consolidate branches, particularly in the Family Islands. RBC also announced several changes to take effect this month as it shifts its services to digital banking.

Mr Rolle said: "Our commercial banks should not be viewed as centres of employment. If we are saying to them you must hire or you must not let go, then they are going to recoup the costs from the consumers in transaction charges.

"We want them to be efficient, and we want the jobs to be created in the offshore sector. We also don't want them to pass on costs from bad lending decisions. We will give them a Credit Bureau to better understand the consumer better."

Mr Rolle also revealed that the Central Bank is looking at ways to simplify the process of opening a bank account.

"There are two elements and one is identification," he said. "In terms of regulations we are going to simplify that.

"We are also looking at whether the issues around address verification for residents can be toned down. At the same time we are putting a lot more emphasis on protecting the system from money laundering exposure and exposure as it relates to terrorist financing," added Mr Rolle. "Getting the account opened is not where we want the road block to be, but what we are saying is that once they are open financial institutions will still be held accountable to monitor those accounts so that we don't expose our country to any reputational risks."