RBL wants FATCA passed

Baptiste shared his thoughts with Newsday after the inauguration of the bank’s new SouthPark Shopping Centre branch on Saturday last. The branch is a replacement for the company’s Pointa- Pierre unit which they closed earlier this year due to health concerns arising out of its proximity to Petrotrin’s Point-a-Pierre refinery.

Baptiste does not understand what the keep back is in passing the legislation.

“The Bankers Association gave this government and the previous government copies of the legislation that was done throughout other Caribbean countries,” said Baptiste, who is also the Vice President of the Bankers Association of Trinidad and Tobago.

“It is not rocket science.

Trinidad is not the only country, it is not the first country, it is not even the first country in the Caribbean that is looking to pass this legislation.” After the Opposition refused to offer the three votes needed for the passing of the FATCA legislation in Parliament with the September 30 deadline drawing nearer, Government announced that it intended to ask the US Treasury for an extension of time to allow for a Joint Select Committee session to be held after the budget.

Baptiste, on the other hand, thinks it is not so serious. “We said to them, ‘here, take this legislation, just do a search and replace Barbados with Trinidad and Tobago, what more do you need to do?” he asked. “Of course, it is not so simple, but we really tend to make a mountain out of a molehill unnecessarily.” Other Caribbean countries that have acquiesced to FATCA legislation include Barbados and the Bahamas.

Talking about the implications of FATCA not being implemented, Baptiste said that the air of doom and gloom surrounding the issue is justified. “In a best case scenario, our correspondent banks will withhold 30 percent of all of the US inflows into this country if the US does not give an extension. In a worse case scenario, the correspondent banks will decide that it is too much work and just cease the relations with the local banks in which case you have no way of getting any of the money you have outside there into the country.

If that is not doom and gloom, I am not sure what is.” He also said that the correspondent foreign banks appear to have no qualms about removing themselves entirely from non-compliant countries, citing Guyana as evidence.

He noted that the potential for US banks being fined an “unlimited amount” for making any mistakes in the enforcing of the legislation far outweighs any potential revenue the banks are currently earning in Caribbean territories. Still, despite these concerns, Baptiste expressed confidence in the long-term future of the economy.

“Now is really the time to do what we have done in previous cycles to reinforce our foundations.

So RBL has been investing in technology, in premises, in people, so that when you come back into the upswing you are not then trying to catch up.” According to Baptiste, RBL spent close to $200m over the last two years building five new branches across the country.