KINGSTOWN, St. Vincent, Feb. 26, IWN – The government of St. Vincent and the Grenadines has restated its commitment to saving the embattled Building & Loan Association (BLA)
“My government, this government, will not permit the Building & Loan to go under,” Prime Minister Dr. Ralph Gonsalves told a press conference on Monday.
The Financial Services Authority (FSA) took over management and control of the BLA and fired its board of directors after a run of $9 million triggered by a newspaper letter by government economist Luke Browne.
Gonsalves said his Unity Labour Party administration has put in place support mechanism for the FSA and the BLA.
He said that in addition to contracting consultants, the government has ordered that $6 million, which the BLA owes the government for interest levy, be converted into equity at the BLA.
But Gonsalves reiterated that his government has made it clear that it does not want any vote in BLA notwithstanding the investment.
“It is only to assist them in cleaning up their balance sheet in the interest of the depositors and in the interest of the financial stability in the country in as much as the Building & Loan has deposits … close to 13 per cent of the gross domestic product of St. Vincent and the Grenadines,” Gonsalves said.
Gonsalves, who is also Minister of Finance, further noted that the Government has applied for $15 million support from the Eastern Caribbean Central Bank.
“It is a loan which we are taking — the government. We will on-lend it to the Building & Loan but it is we who have to pay it in the meantime, if he facility is used. … I want to say further that if additional resources are required, and I hope not, I will find additional resources,” Gonsalves said.
“So, I give as the overriding affirmation that this government and this minister of finance will not allow it to go under,” he said, as he urged persons, including his brothers, who have withdrawn their investments from the BLA, to re-deposit them.