U.S. banks pulling out not limited to Guyana- Finance Minister
Minister of Finance Winston Jordan
Minister of Finance Winston Jordan

FINANCE Minister Winston Jordan is clearing the air that although at least one U.S.-based bank has pulled its support from Guyana, this situation is not unique to this country. “The first country to complain about this de-risking, I think it was Belize, which, since last year had complained that their correspondent banks had started to leave because they didn’t want to be involved anymore with accounts in these countries,” the Minister Jordan told the Guyana Information Agency (GINA) recently.
Since the implementation of the Foreign Account Tax Compliance Act (FATCA), U.S.-based banks have been pressed to ensure greater scrutiny of accounts within the U.S. that are held by persons or entities outside of the U.S.jurisdiction.
Much of trade within and outside the Region is done using the U.S. dollar. As a means of cutting costs, Caribbean financial institutions have created partnerships with U.S.-based banks using “correspondent accounts” rather than setting up branches in that country.
Those partnerships allow the U.S. dollar to be traded between regional financial institutions and the rest of the world. A cutting of those connections could affect the flow of U.S. dollars in the Region.
Following the terrorist attacks in the U.S. in September 2001, the U.S. Congress implemented an aggressive regime of anti-terrorism and anti-money-laundering measures which affect the world’s financial system.
Caribbean and Latin American Governments are still shuffling to follow through with compliance measures imposed by Congress since the U.S. could sanction banks based in that country which conduct business with the Caribbean and Latin America.
Most of the capital flow within the Caribbean and Latin America uses the U.S. dollar as the common denominator.
De-risking has been used as a mechanism by U.S. financial institutions to avoid threats to their financial systems from money-laundering and terrorist-financing. Those measures, however, have proven troublesome for smaller states.
Governor of the Bank of Guyana, Dr. Gobind Ganga, recently informed the nation that the Bank of America was severing relations with the local banking industry for which it has been a correspondent bank.
The Finance Minister indicated that the Bank of America’s withdrawal is in keeping with the implementation of the Foreign Account Tax Compliance Act (FATCA)
Meanwhile, the Finance Minister also identified countries of the Organisation of Eastern Caribbean States (OECS), Jamaica and Central America as being affected by the withdrawal of the correspondent banks.
“Even Panama which has one of the strongest anti-money laundering systems had complained about de-risking activities,” Minister Jordan said.
The consensus of regional governments following the recently held 37th CARICOM heads of government meeting in Guyana was that the U.S. government would have to be lobbied into reducing the pressure currently faced by the Caribbean financial system.
Although CARICOM is preparing to lobby the U.S. on the measures imposed by that country, there is some skepticism on the lobby’s success, especially since regional Governments were never consulted on measures being implemented by the world power in the last 15 years.
Jamaica’s Prime Minister Andrew Holness called CARICOM’s lobby “proactive and instrumental” when he addressed the press corps in Guyana recently.
“I think that reason will prevail and I think that our voices need to be a little louder so that the people who matter and who can change the decisions hear us.”
Since much of U.S. investment is tied to the Caribbean, Holness said any threat to the Region’s banking system is also a threat to U.S. investments within the Caribbean.

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