Congressional roundtable on de-risking in the Caribbean ‘successful’

US Congresswoman, Maxine Walters with Antigua and Barbuda Prime Minister, Gaston Browne.
Gov’t of Antigua and Barbuda

The Antigua and Barbuda government has described as “successful” a fully-attended roundtable meeting in Washington, D.C. on Tuesday between representatives of the the 15-nation Caribbean Community (CARICOM), members of the United States Congress and senior representatives of major US banks on the effects of de-risking and the withdrawal of correspondent banking relations (CBRs).

An Antigua and Barbuda government statement said on Wednesday that the roundtable was first proposed by Antigua and Barbuda’s Prime Minister, Gaston Browne at last July’s meeting of CARICOM Heads of Government.

Since then, Antigua and Barbuda’s Ambassador to the US Sir Ronald Sanders worked with Congresswoman Maxine Waters, as chair of the Committee on Financial Services of the US House of Representatives, “to make it a reality,” the statement said.

It said senior bankers from six major US banks and US Congressional representatives gathered with a delegation representing CARICOM at Capitol Hill in Washington under the chairmanship of Congresswoman Waters.

The CARICOM delegation was led by Browne, who is the CARICOM lead on financial matters.

According to the statement, Browne told the meeting that the Caribbean and the US have “a mutuality of interests, which necessitated each side displaying active concern about the well-being of the other, including security.”

In this regard, Browne said that the process of de-risking, which has led to a withdrawal of relations by some US banks from Caribbean banks, “poses a serious threat to the region’s welfare, including its capacity to import goods from the US, which totaled over US$13 billion last year, and is set to exceed this figure this year,” according to the statement.

It said that representatives of the US banks indicated that they recognize that value of CBRs, “not only in financial terms but in the critical role it plays in global trade, investment and other financial services.”

“They expressed a keen interest in overcoming the challenges posed by a regulatory environment in which banks are conscious, in their decision-making, of the severe penalties for incidents of money laundering and terrorism financing,” the statement said.

“The banks made a number of helpful proposals for how this issue could be addressed,” it added.

In response, Brown pointed out that, over the last 10 years, US$26 billion has been imposed worldwide as fines for non-compliance with money laundering, “but not one bank was located in the Caribbean.”

“US legislators expressed alarm at the effect on the Caribbean of de-risking and the loss of CBRs from US banks, as well as the effect on US national security, if the situation worsens,” the statement said.

“The Roundtable reached joint conclusions that the problem has to be tackled urgently and at several levels,” it added. “All participating groups at the meeting resolved to work on solutions that arose from the discussion.”

Prime Minister Browne expressed “great satisfaction” with the outcome of the meeting and the obvious commitment of US legislators and the US banks to work with the Caribbean on solutions, according to the statement.

Browne told the meeting that what is required is “to build trust and confidence between correspondent banks in the US and respondent banks in the Caribbean in a transparent relationship.”

Waters said that she and the US House Committee on Financial Affairs “will remain engaged in the matter and are willing to take actions that may be necessary to preserve the mutual interests of the US and the Caribbean,” according to the statement.

Caribbean governments were represented by the Prime Minister of St. Lucia, Allen Chastanet; the Finance Minister of Jamaica, Nigel Clarke; the Attorney-General and Minister of Legal Affairs of Barbados, Dale Marshall; the National Security Minister of Trinidad and Tobago, Stuart Young; and the CARICOM Secretary-General Irwin LaRocque.

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