RBC head advises business sector to capitalise on low interest rates

There is a time in an economic cycle to make investments. Some companies can profit in the present financial environment. Our advice to our clients is to take advantage of the low interest rate environment to make capital purchases and for working capital financing. Companies should make more efficient use of excess liquidity in the system by allocating surplus cash into strategic vehicles such as mutual funds, ohnston told the audience of more than 400 finance and accounting practitioners on day two of the conference, whose theme was Turnaround Prescriptions – Strategies for Success in Challenging Times.

Noting that the local, regional and global economies were experiencing challenging times, ohnston pointed out that the middle class was under pressure and geng smaller. We have seen the middle class contracted and depressed. The result is that there are all sorts of social challenges as a consequence of these difficult economic times, ohnston advanced. The RBC Caribbean head said that among the turnaround prescriptions implemented by RBC in the challenging environment were increased collaboration with Treasury meaningful partnering with industry associations, government and regulators offering clients a choice on investment vehicles accelerated loan collection efforts placing greater focus on attracting quality loan clients and positioning the bank’s products to provide value for money.

RBC Royal Bank was the lead Titanium sponsor for the conference hosted by The Institute of Chartered Accountants of Trinidad and Tobago (ICATT) whose president, Pria Narinesingh, expressed confidence that the twoday discussions would contribute to
the body of effective prescriptions for the well-being of the body corporate and the body politic. In his presentation titled Managing Profitability Liquidity in a Challenging Economic Environment – A Banker’s Perspective, ohnston outlined some of RBC’s turnaround efforts to add value through convenience, such as expanded investments into mobile, online and ATM banking services. Cash is very expensive. Cash is very risky. We give our clients options on how they should bank.

We provide value for money. Success is defined by utilising technology where financial decisions are made, not by the number of branches you have, he explained. Johnston said that with the current challenging economic environment, governments were pursuing revenue sources in a more aggressive manner with the result that revenue from taxation measures was increasing. He acknowledged that the regional banking sector fully appreciated the pressures faced by clients for foreign exchange, especially in Trinidad, Barbados and The Bahamas. We are living in a complex world. And it isn’t going to change in the near future, he cautioned.

Drawing reference to the corelation between interest rates charged by banks and interest on deposits and RBC’s own operations, ohnston explained that there must be a proper level of exibility for banks to meet their commitments, including regulatory and other charges. Earlier, the RBC banking expert painted a picture of The New Normal with stark characteristics of anaemic economic growth, suppressed lending appetites, limited growth opportunities, excess liquidity, F demand pressures, rising ination, greater regulatory pressure and cost, and small, undiversified, semi-open economies. owever, with more than 30 years experience in the financial services sector, ohnston proffered prescriptions and strategies for success in the future.

As a region, we can expect more challenging times in the years ahead. We recognise that we have a role to play and we are working with regulators, governments and other players in providing constructive inputs toward making wide-impacting financial decisions. Forums like these are absolutely appropriate given the current global economic climate. The information we share here will develop workable turnaround prescriptions and buffer our economies through difficult times, ohnston advanced