KINGSTOWN, St. Vincent, April 12, IWN — The 666 persons who, up to Thursday, had submitted letters of withdrawal of their investment from the Building & Loan Association (BLA), could cause the building society to collapse, if they follow through.
That was the impression with which some shareholders who attended the meeting with the Financial Services Authority (FSA) on Thursday was left after the proceedings.
“I think the impression is clear. I can’t say that they actually said so but they were really seeking those of us at the meeting to talk to people whoever we can convince to withdraw their withdrawal letter,” social activist Junior Bacchus, chair of the committee of BLA shareholders interfacing with the FSA in an effort to save the BLA, told I-Witness News on Friday
“They didn’t say it directly, but the impression you got from the conversation was that if they have to go and settle those requests, the Association will collapse. It is better they change course and go to judicial management. And that means the collapse,” Bacchus further said.
The FSA was meeting with shareholders en masse for the first time since it took over management and control of the BLA on Feb. 1.
Luke Browne, a politician with the ruling Unity Labour Party and an economist in the Ministry of Finance, had written a letter in a local newspaper on Jan. 18, asking questions about the management and financial health of the BLA and asked if the 72-year-old building society was on the verge of collapse.
The FSA says EC$9 million was withdrawn from the BLA in the two weeks after the letter.
The meeting on Thursday was closed to the media but some shareholders spoke to I-Witness News as they left.
Some said that the meeting had failed to engender confidence that they should keep their investments at the BLA.
One male shareholder said that while the FSA said that it would not allow the 666 applicants to cause the society to collapse, he felt as if persons who wait longer to submit letters of withdrawal stand to lose more.
A female shareholder said that no one from the FSA had contacted her personally asking about her intentions or seeking a commitment that she would not withdraw her investments.
Bacchus told I-Witness News that the meeting “provided a lot of data” but it did not engender confidence.
“I don’t think so, to be very honest. The penultimate young lady who spoke at the meeting, she was raising concerns about her lack of confidence.
“While she herself understands that she should not withdraw her money, she said to the meeting she couldn’t leave there with enough confidence to convince the people who she is linking with in the diaspora … that they should withdraw their letters.
“So, what [Executive Director of the FSA, Sharda Bollers,] did, was to ask her to come in and let her speak with her one-on-one. So, my feeling is that — using that lady’s comments — people didn’t leave there with much change in terms of their confidence level,” Bacchus told I-Witness News.
Bacchus further said he couldn’t say that during the meeting “any significant financial data was disclosed that we didn’t know about.
“They have decided on a two-phase plan. … The first phase should end by the end of June and the second phase should end by the 15th of August. That second phase is the time when they should have a new board installed, a CEO appointed and the transfer for the exit of the FSA.”
Shareholders had expressed concerns about the possibility that the FSA could tie the BLA into a long-term contract with a CEO.
“In respect to the CEO, it will be a short-term appointment. So, we accepted their feedback on that,” Bacchus said.