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Posted: Thursday 18 February, 2021 at 11:09 AM

All regulators blocked sale of CIBC First Caribbean 

By: Staff Reporter, SKNVibes.com

    BASSETERRE, St. Kitts  - REGULATORS in the region have unanimously blocked the sale of CIBC First Caribbean operations to the Galinski Group.

     

    Governor of the Eastern Caribbean Central Bank, Timothy Antoine confirmed that position at a press conference following the concluded 98th Meeting of the Monetary Council.

     

    In addressing the matter, Antoine explained that all regulators across the region had considered the sale - with the Central Bank of Barbados being the lead - and “came to a decision that was conveyed and the application was denied”.

     

    The Colombian-based Galinski Group had proposed a $797 million takeover of the FCIB operations in the Caribbean pending approval from the regulators. 

     

    However, in a statement issued earlier this month, the bank’s parent company in Toronto, Canadian Imperial Bank of Commerce (CIBC), confirmed that regulators had denied the application for the sale.
     
    Antoine did not give any indication on what factors led to the takeover being denied, but sources at FCIB’s Headquarters indicated that staff and upper management were happy with the sale being denied as concerns were being raised over the takeover.

     

    The Galinski Group (GNB Financial Group) in December 2019 moved to purchase a majority stake in FCIB - some 66.73 percent- with the US$797 million purchase. 

     

    This move was seen by some financial analysts as being one for the CIBC to exit the region, as most Canadian financial institutions are seemingly fleeing the region due to stiffer Anti-Money Laundering and Counter the Financing of Terrorism Legislation, which was passed to ensure territories of the region are money compliant with international regulations.

     

    At the same media brief, the Governor acknowledged that the sale of Canadian financial institution, Royal Bank of Canada (RBC), has been approved - highlighting that it would be exiting the region on the signing off of all documents.

     

    Financial analysts had suggested that under the De-risking measures, many multinational financial institutions were concerned over the risk and the heavy fines proposed if they were to have been found in breach of the regulations; so they preferred to leave the region altogether.
     
    Sources explained that the RBC exit could be finalised within the next month.
     
    Bank of Nova Scotia (Scotia Bank) is the most recent Canadian bank to have sold its assets when it was taken over by Republic Bank.  

     

     

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