JAMAICA: Depositors Left Confused Following Bank's Takeover

KINGSTON, Dic 20 (IPS) - Depositors of one of the oldest merchant banks in the country remained confused and frustrated Tuesday following government's takeover of the company.

All five branches of the Blaise Trust and Merchant Bank remained closed Tuesday following a declaration by the bank's management that it was unable to meet depositors' demand of 1.5 million dollars and intervention by Minister of Finance, Omar Davies.

An audit of the Bank which has been operating in the island for the past 30 years, has been ordered by Davies who has meanwhile taken control of the institution.

In announcing the takeover, Davies said the extent to which the bank was carrying out is fiduciary responsibility has been a matter of concern for the past several months.

Sources say the Bank of Jamaica -- the Central Bank -- has been unhappy with the management of Blaise for a long time. The Central Bank was concerned that it was not operating within the requirements of the law and had too many inter-company loans and investments.

In August, the Central Bank sent in the accounting firm, Price Waterhouse to do an audit and began its move to force out Chairman, millionaire Donald Panton from majority ownership.

The Central Bank also demanded the resignation of the general manager at the time, John Francis, saying it was dissatisfied with the way he was running the institution.

Last week the Central Bank recommended to the Finance Minister that the institution be taken over by the state, pending an investigation.

Davies has declined to reveal details of the irregularities uncovered which prompted his move.

But American Businessman, James Eroncig who stepped in three months ago to take majority ownership of the company when Panton was forced to scale down his holding, reportedly told government recently that the accounts were so messy that he wished to bail out.

Observers say Davies' announcement that he was taking over the bank came as no surprise.

In November Eroncig had appointed a new management team with the mandate to "clean up" the operations of the company.

© Inter Press Service (2014) — All Rights Reserved. Original source: Inter Press Service