( L - R ) Samuda, Hylton
Karl Samuda, minister of industry, investment and commerce, has slammed local banks for their high level of bureaucracy, saying the procedures for opening accounts were unduly cumbersome.
He also criticised bankers for not giving manufacturers more favourable terms, meaning more time to pay off loans.Samuda, who was the keynote speaker at the JMA/JEA expo media launch Thursday, seemed frustrated as he recounted an example of a jolted foreign investor who had to deal with a "half an inch of documents" to open an account at an undisclosed bank.The expo is scheduled for May 1."A young man," said Samuda, "actually showed me the literature he had to fill out which was very intimidating and very cumbersome and bureaucratic and he was not borrowing money, he was depositing US currency; and for months he has not done it because he refuses to go through the level of bureaucracy that is required."Patrick Hylton, president of the Jamaica Bankers Association, said he was sympathetic to the concerns, but noted that the banks were constrained by the very laws that Samuda and his colleagues preside over."As I said to the minister, many of the requirements have been imposed by legislation; the legislation was passed in Parliament," said Hylton, when asked by the Financial Gleaner for a comment.
Requirements imposed
Hylton was at the same function in his capacity as group managing director of National Commercial Bank, the island's second largest."Regulations that came as a result of various agreements to which Jamaica is a counter party and as such, these requirements have been imposed on us, and I think that in many instances Karl must have considered why it was important and why it was appropriate for those regimes to have been implemented," Hylton said.The banks are required to adhere to the new Proceeds of Crime Act (POCA), as well as directions from the Bank of Jamaica.Under POCA, the banks are required to set measures to detect and prevent money laundering within their banks or face prosecution.Samuda says he understands that the banks have to be careful in their procedures, but still believes that they could be less "cumbersome" in their dealings with clients."It is important for the banks to be careful in what they do, but certainly a half an inch of document in my opinion is too cumbersome," he said.
richard.deane@gleanerjm.com