Feb 2007 Financial News

No merger with RBTT

Feb 14, 2007

REPUBLIC BANK yesterday said it is considering pursuing mergers and acquisitions in the Caribbean but has no interest to merge with rival RBTT.

This was the word yesterday from Republic Bank CEO David Dulal Whiteway during a news conference at the bank’s Park Street head offices in Port-of-Spain to discuss “bank related matters.”

After saying Republic Bank recorded a $650M profit in the first quarter of this year, Dulal Whiteway said he believes there is a need for a “strong indigenous Caribbean bank” and Republic wants to become that bank. Dulal Whiteway said Republic Bank earned US$102M from the recent sale of its shares in First Caribbean International Bank (FCIB) and has kept those monies liquid for purposes such as potential mergers or acquisitions.

He hinted that Republic Bank’s best opportunities to merge with or acquire another financial institution lay within the Caribbean and was not looking to become involved in the financial markets of Central America at this time. Locally, Dulal Whiteway ruled out any possibility of a merger with RBTT.

“If you put both banks together, for many of our products, we will have between 60 and 90 percent market share. Therefore, in certain areas we will end up with almost like a monopolistic position. I don’t think it will be healthy for the economy. I don’t believe the regulator would even approve it,” he stated. Dulal Whiteway added that Republic Bank’s current asset base was $35B and US$2B in market capital. He said it was unlikely that Republic Bank would purchase any assets of FCIB because that bank had a market value of about US$6B.

RBTT officials yesterday said there were no plans for a merger with Republic Bank. They said talk of FCIB being interested in acquiring some of RBTT’s assets was market speculation and it had no comment to make on that issue.

Dulal Whiteway said Republic Bank’s operations in Cuba were going very well and he was optimistic that a partnership between Clico, a major shareholder, and the bank could be achieved in the future. However, he said the bank was not getting involved in the insurance business. He said the new Financial Institutions Act which is now being prepared will make it easier for banks to offer certain types of insurance but will prevent any executive who is a member of one financial institution’s board from sitting on the board of another financial institution. Noting that Clico has representatives on Republic’s board of directors, Dulal Whiteway said that arrangement has worked well to date.

Newsday
Wednesday, February 14 2007
http://www.newsday.co.tt/news/0,52333.html