By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
Businessmen yesterday voiced scepticism that 99 percent of new bank account applications are approved - often “in less than a week” - as they described the process as akin to “pulling teeth”.
Sir Franklyn Wilson, the Arawak Homes and Sunshine Holdings chairman, branded the findings of the Central Bank’s first half-yearly bank account opening survey as “a play on words” with both himself and Paul Moss, the Dominion Management Services president, suggesting the true bureaucracy and red tape occurs prior to the decision-making point in satisfying the banks’ document demands.
“Listen to what they say: ‘Once all the documents required are submitted they will approve’,” Sir Franklyn said. “The problem is they keep asking for more documents. That ain’t saying nothing. The point is it’s the process of getting to the point where they say they have all the documents.
“They need this, they need a utility bill, they need so many things. It sounds to me like that’s a play on words. You’re playing on words, this language. A company I’m involved with, we employed a new senior executive, and just to get permission for him to sign the account took for ever and ever.
“Just to add a signatory to the bank account, it went on and on. It’s crazy. They [the Central Bank findings] may be right but, to me, it sounds like a play on words.” He was backed by Mr Moss, who said the commercial bank survey findings do not match his own experiences when it comes to opening bank accounts for corporate and individual clients.
“It’s the lead-up to all the documents they need,” the Dominion Management Services chief said. “It may take a week or more to get to that. There’s now, from my own experience, no clarity or rhyme or reason for why those document requirements change. It’s so bad for us.
“We do not even recommend the commercial banks to foreign clients to open accounts here. It doesn’t make any sense for us to do it here. We just can’t seem to get it open, get it open on time. It’s just not going to happen. Sometimes the client doesn’t have the patience. Sometimes we tell them it will take six weeks, and when it comes around and there’s absolutely no development, they get discouraged and we have to pull the application.
“Banking in The Bahamas is not a strong suit for this jurisdiction. It’s not. It’s not a strong suit,” Mr Moss told Tribune Business. “We have some private banks in the country but even those take a long time to establish accounts. Here, the commercial banks are not banks in that sense because whenever you open an account it takes a long time.
“Our clients, if they have a bank outside the jurisdiction, we recommend that and that’s what we’ve been doing. We do it outside the jurisdiction. Banking here has faded away and I can’t even say the year. It has been gone, but gone for a long time.
“It seems to be a position of the banks, the commercial banks, that they don’t want to open an account for foreign persons and sometimes make the requirements so steep that it doesn’t make sense. The private banks do the same unless they come from a jurisdiction where they have a branch or something like that. Then they can get some play,” he added.
“I don’t advise them to get an account in The Bahamas. Even with local companies it’s like pulling teeth; pulling teeth. There’s a lot of work to be done, no question about it.” Sir Franklyn, meanwhile, compared the ease of opening an account in this nation to its close northern neighbours.
“The fact of the matter is, in Canada, I was in Toronto the other day and they were advertising how you can open an account so fast. Big billboards. They’re advertising that in Toronto,” he added. Both men spoke out after the Central Bank survey found the number and percentage of rejected new bank account applications was relatively low during the six months to end-July 2024.
Of the 28,153 new deposit account applications submitted during the 2024 first half, the banking sector regulator revealed that more than 99 percent were processed and approved during this same six-month period with less than 1 percent denied or rejected.
And, once all necessary Know Your Customer (KYC) and due diligence documents were supplied by individual and business applicants, all banks made decisions on whether to approve the requests “in less than a week”.
Unveiling account opening data for the 2024 first half, the Central Bank said: “During the first half of 2024, commercial banks reported that a total of 28,153 deposit applications were received, including those that were deemed to be incomplete.
“Of this total, approximately 99.1 percent were processed during the review period. The vast majority were classified as resident applications (27,347), with the remaining 806 submitted by non-residents. By account type, most requests were for savings accounts (72.6 percent), followed by demand deposits (15.1 percent) and fixed placements (9.4 percent).
“By type of depositor, resident private individuals submitted the majority (94 percent) of applications at 25,699. Businesses represented the second largest share of such applications, 1,502, or 5.5 percent. A negligible number of such applications were received from the public sector and private financial institutions,” the Central Bank added.
“Over the six-month period, 99.2 percent of total resident applications were processed, with private individuals experiencing a processing rate of 99.2 percent and firms a rate of 98.1 percent. On outcomes, 98.7 percent of total resident applications were approved and 0.4 percent were denied. A remaining 0.2 percent of applications were still pending review at the end of December 2024, and 0.7 percent of requests were still considered incomplete.
“All financial institutions disclosed that once all supporting documentation were received, decisions were made on applications in less than a week. The final decision-making authority on most applications rested at the branch level, although three banks concluded a portion (5 percent to 20 percent) of their requests at an enterprise level outside of the jurisdiction.”
Comments
bahamianson 2 days, 9 hours ago
Is Dentistry that hard?
screwedbahamian 2 days, 8 hours ago
It takes 3 to 4 weeks to get an appointment to open an account at most banks on New Providence. The first question by the bank clerk is "HOW MUCH YOU ARE STARTING THE ACCOUNT WITH" before you will know if the appointment will be in 1 week or 3 to 4 weeks before an appointment is set. Then when you go in for the appointment, they give you a list of documents that you must bring back to them in another 2 or 3 weeks. Their list include how many sheets of toilet paper you use to wipe yourself. it is a very difficult challenge for the prospective customer to outlast the banks demands. The saving rate of Bahamians has got to be the lowest in the western hemisphere. Instead of going through the long and tedious process of opening a savings account at the Bank, Bahamians go to the " WEB SHOPS" to spin and lose their money, the way the government designed it to enrich their owners and politicians. Talk show host's talking bout local Bahamians opening businesses, SERIOUSLY?? IN THE BAHAMAS????? GET REAL!!
One 2 days, 7 hours ago
My experience was worse, the appointment was 4 months away. It's a disgrace. Imagine being on a family island when many islands don't have any bank branches anymore. You have to fly to Nassau 2-3 times before you can get a bank account. In the 90s I remember the banks used to promote people getting accounts with them. They had special accounts for kids to open savings accounts (no fees and no minimum balance). Now look at where were are 25-35 years later. Businesses and people on the family island have to rely on their mattresses, webshops, mailboat and aircraft crews to store and send money.
One 2 days, 8 hours ago
Thank goodness someone with enough power to be heard is pointing out the intellectually dishonest wording of the findings. In a way what they were saying was once we've decided to give you a bank account 99% of the time we give it to you. But the issue is before this. How long and what is the success rate of the average Bahamian for going from no bank account to a bank account? How long before the bank gives you an appointment and does prescreening? What is that success rate for me walking off the street into a branch today for the first time with no prior contact/arrangements?
bogart 2 days, 5 hours ago
Its all about the PROFITS.
These decisions in allocation of money to accomplish goals over other areas are ultimately by the headoffices in other countries and in conjunction with levels of generating profits by other countries the bank operates in the Caribbean. Seems always to get the most from the weakest voices.
Its all abouts Profits. The banks inability to meets the targets of profits in certain expected departments will simply first cut staff in other departments. If you cannot make the profits you cut the expenses in areas.
Banks profits from the Bahamas goes from leaps and bounds from year to year and are in hundreds of millions of Us dollars. Cannot say the same for other Caribbean countries the banks operate in. Simply if they make the profits then why is there no pronounced outbursts by the regulatory Bahamian offices to have made better ways for the Bahamas second largest sector to not thrive successfully by having these banks employ more staffing to expedite this long ongoing process? Why?
Going back 20 years or more the Bahamas had imposed onerous amounts of paperwork for customers to open the accounts and meet tough regulations. In 2018, after ton of papers to open bank accounts, it was extremely shocking that some 42,425 bank account owners could not have been found, and bearing in mind that the Bahamas population is actually squished on a 80 sq mile island and most reside in the more densely eastern half.
Bearing in mind that these opening conditions were in coordination with the government Bahamian regulators in compliance of the money laws, and Bahamian should know that the Police can locate anyone within hours, courts can locate anyone in short time, political generals can locate any voter in any constituency and even tell you how many voters are in the house (joke).but true. Who cannot find any of 42,452 adult people on this island or in the Bahamas and declare then not to exist and accoounts declared DOrmant? over years many financial institutions or insurance companies seem to place list of names of people to contact them.
The banks declaring 42,452 accounts dormant could have been reduced by having more staaff employed to find these customers with over 100 million in these accounts as a part of their business instead of passing it off to the very same regulators as they are dealing with in the current situation.
Investigations need to be done as to why these very negatives occurances keep going on to the hardships in the finance sector and having the bad occurances is like dentistry pulling teeth but instead it is actually reality of pulling food out of Bahamian peoples mout.!!!
Heads must roll.
Porcupine 1 day, 13 hours ago
The Central Bank and it spokesman are not paid to help Bahamians. They speak on behalf of their owners.
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