St. Maarten Bankers Association does not anticipate bank defaults due to recession

POSTED: 08/12/11 7:11 PM

St. Maarten – Even though they’re not sure what the effects of the ongoing worldwide recession will be the members of the St. Maarten Bankers Association are convinced no banks will run into trouble. The announcement was made during a recent Central Committee meeting.
President of the St. Maarten Bankers Association Jan Beaujon linked his expression of confidence with, amongst other things, the conservative way in which banks here do business by not taking on too much risk and the watchful eye of the Central Bank of Curacao and St. Maarten.
“We have a good sound system and a regulator that has been able to build trust and confidence all over the world. I also don’t anticipate that anything will happen that will lead to a run on the bank, because the moment a bank begins to have a problem they must inform the Central Bank. We also have to submit full financial statements every month and the Central Bank carries out regular inspections, including assessments on our liquidity and our deposits,” Beaujon said.
Ronald Halmon pointed out that the proof of the strength of the banking system in times of crisis was most recently shown during 2008 and 2009.
“Back then we had minimal impact because we have always been conservative in the way we do business,” Halmon said.
“The year 2010 started off with some difficulty but then things stabilized, especially in the latter part of 2010 things went a bit better. In 2011, we’ve seen a short season that went straight into the off season,” Beaujon added.
The Bankers Association president stressed that while the bank’s are committed to riding out the crisis by being empathetic they had to ensure they lived up to Central Bank regulations and satisfied the targets set by their shareholders.
“For example the moment we have delinquencies it becomes a profit issue and we have to step up collections,” Beaujon said.
The final ultimate guiding principles for banks here is that they must stay solvent in order to hold on to the trust of the people who deposit their money with them.

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