Financial system not hopeless – experts

February 24, 2023
Stocks and Securities Limited’s headquarters on Hope Road, St Andrew.
Stocks and Securities Limited’s headquarters on Hope Road, St Andrew.

At least two prominent finance experts have sought to calm the public's nerves around the viability of the banking sector amid increased reports of theft and fraudulent activities.

In the most recent black eye on the financial sector, a bank employee reportedly made off with more than $35 million from a St Ann-based institution. Other incidents, including the defrauding of customers of Stocks and Securities Limited, track legend Usain Bolt among them, have dented the public confidence. Some people, including small business owners, now consider stashing their hard earned cash under their mattresses as a precaution.

But Dr Andre Haughton, who is a senior lecturer in the Department of Economics at The University of the West Indies, Mona, said the situation is not as dire as many think.

"What we are seeing is really bad, both for the institutions and for the country. But the magnitude is not so great to cause such a large uproar and convince people to really want to move their monies to mattress," he told THE WEEKEND STAR. He added that persons should instead find creative ways to handle their money if they have lost faith in the financial sector.

"Any likkle money dem have, dem have to find workable ways for it. Money under mattress is good for a rainy day but it is not good for development. So right now it is important if they look into some small businesses or join a partner, any little thing that could further secure their cash," Haughton advised.

However, experienced financial analyst Ralston Hyman, said that while he agreed that the situation is not as dire, he advised the authorities of the need to restore confidence.

"If they don't move to restore confidence and allow the street talks to continue, then it will be a trouble. From day one the people in the streets never trusted banks, and with these frequent incidents relating to fraud and the taking away of the legend's (Bolt) money, if they don't do something to cauterise these things, then more and more people will lose faith in the financial system and try to keep their monies at home under the mattress," Hyman said.

He added that; "The [finance] minister has to say a whole lot about that when he make his budget presentation in order to inspire confidence. People are watching the SSL thing and the Integrity Commission and if they try to abandon it or fire the man them, that will create a greater degree of loss of confidence both internationally and locally."

A small business operator, Lola Ledgister, who runs a mini-gaming lounge in the Corporate Area, expressed concern for the safety of her money.

"I am losing trust due to what is going on now. I do not want to hear that the bank goes bankrupt and I have to start all over from zero. I am aware of the legislation against home banking but I am thinking that this is the safest route right now," she said.

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