Bahamas News

RBC’s Bahamian team has succeeded in winning the banking titan entry into the Turks and Caicos market, with authorities there granting a banking license — even as Nassau representatives hosted a job fair in Providenciales.

“I can confirm that their application was approved,” Turks and Caicos Minister of Finance Floyd Hall yesterday told Guardian Business. “If they don’t have their license yet, they should have it by Monday.”

That piece of paper confers full commercial banking rights on the Canadian institution, which is now concluding a job fair in the Turks capital. That developing hub of activity has also been selected as home for RBC’s first commercial bank in the territory. Hall and others in the local financial services sector suggest the RBC has already scouted out a Grace Bay location to house its fledgling operation.

Heading that assault is its Nassau team. No one from that regional head office could be reached for comment Thursday.

But the finance minister is suggesting his jurisdiction’s newest player — expanding the number of commercial banks to four — will likely focus on servicing all aspects of the growing economy.

Its GDP has seen double digit growth over the last decade, he said, with further projections for an eight-to-nine percent increase this year.

“I think the full gamut of banking is at RBC’s disposal,” said Hall. “I would believe that is what they will want to pursuit here.

“Our per-capita income has grown from about $10,000 in 2003 to between $13,000 and $14,000 for this year.”

That phenomenal growth is now propelling an increasing tide of Bahamian institutions to the small chain of islands to the south.

Insurance companies as well as banks are leading the charge, looking to grow their businesses in an emerging economy so close in so many ways to their own.

It’s a natural fit for them, said Hall, given the shared history and culture between the two archipelagos.

But, Bahamian businesses may have to move quickly.

“We are getting applications from the banks in the region as well as internationally,” said Hall. “As we are all aware The Bahamas is our closest neighbor and, at the end of the day, investing here is a good fit for them.”

RBC seems poised to take advantage of the second-home market in Turks, providing funding for the increasing number of American, British and European expats looking for a hotel-condo lifestyle.

They may be looking for a cheaper alternative to the comparable Bahamian property. The price gap, however, is narrowing, and RBC stands to claim a significant share of that business down south, perhaps taking some from FirstCaribbean, The Bank of Nova Scotia and domestic bank TCI.

The move to Turks will likely be completed before RBC finalizes its acquisition of Caribbean banking giant RBTT, based in Trinidad. That $2.2-billion deal will facilitate the institution’s move into the emerging Latin American market.

It will also see RBC’s regional headquarters move to Port of Spain, although analysts have suggested The Bahamas will likely continue to enjoy some regional responsibility in that new structure. That seems all the more likely with the addition of a Turks operation.

That successful expansion — spearheaded by RBC’s Nassau executives — make speak volumes about the banking expertise this jurisdiction has already amassed.

In fact, says Paul McWeeney, managing director of RBC competitor Bank of The Bahamas, local financial service institutions will more and more take that know-how on the road as they look for emerging markets in which to grow their businesses.

While RBC is moving south, his institution is finishing up plans to open its own facility in Miami.

Source: Nassau Guardian