“There is a banking crisis in Virgin Gorda…it is truly a crisis,” Ninth District Representative, Dr. the Hon. Hubert O’Neal told the House of Assembly as he lamented the closure of the Virgin Gorda Branch of Scotiabank.
At the end of June, it was announced that Scotiabank was closing its Virgin Gorda branch effective 1 September. The news was met with worry from Virgin Gorda residents who complained that this would have a bad effect on the community.
However, it was Hon. O’Neal who placed the matter into perspective when he announced that the closure would mean that for the first time in 20/25 years there would be no bank on that island. He explained that this is because Scotiabank was one of two banks remaining on that island and that the other bank previously closed.
This is probably a good opportunity for the sole “local” bank to open a branch in The Valley.
Hon. O’Neal said that he made representation to the bank but was told that the closure was necessary considering that it was not profitable to operate on Virgin Gorda anymore. “Banks don’t really make money from changing checks…,” Hon. O’Neal noted. He said that while there are large companies on the island the bank said that those companies either do their transactions internationally or via the Road Town branch.
As a means of staving off the effect of the closure, Hon. O’Neal said that discussions were had with the National Bank of the Virgin Islands. However, he said that even though the local bank expressed an interest it would not be able to just open a branch. Instead, Hon. O’Neal indicated that there was a procedure.
He also mentioned that he discussed with Banco Popular as well the possibility of opening a Virgin Gorda branch. In the meantime, the District Representative said that he is unhappy that residents will have to travel to Tortola to do banking. He said that he was also worried that no bank on the island might pose security issues for businesses.
Premier Was Warned
Leader of the Opposition, Hon. Andrew Fahie said that Virgin Gorda residents expressed concerns about the Scotiabank closure to him, and in response he met with the management of the bank. Hon. Fahie said during the meeting he was informed that Premier and Minister for Finance, Dr. the Hon. Hon. D. Orlando Smith was notified ahead of time of the intent to close.
Hon. Fahie told the House: “I too met with the officials of Scotiabank, and I was told by the officials that the Premier knew about the bank pulling out of there for quite a while. He would have to tell us that he didn’t know, but that’s what I was told.”
The Leader of the Opposition also criticised the government for what he termed as a reactive approach to the situation: “We are now in a reactive, rather than a proactive mode; again who is going to pay for this – the people. We have to be proactive when these kinds of things come to our attention,” Hon. Fahie said.
Premier Smith informed the House of Assembly that he was informed of the Bank’s intention, but he said he was told that there will be ATMs on the island to provide some banking services.
Hon. Smith said: “We are aware of the banking situation, we did have discussions — myself in my office and also the Financial Services Commission members held discussions with the banks after we were informed that they were intending to close. We understood that the bank would be leaving ATM machine in position…We have also had discussions with other banks about the possibility of providing the service of banking service.”