All and sundry seem fixated with corruption in the government. But when the spotlight is placed on the corporate world, “Guyanese would be faced with a nightmare.”
Those were the words of Opposition Leader, Bharrat Jagdeo yesterday as he called for public corporations to be held accountable for their actions in the business environment.
During a press conference, the former President bemoaned the fact that the government has taken no action when it comes to the incestuous relationship between some large businesses and local banks.
He also criticized regulatory bodies such as Central Bank and the Securities Exchange Change Council for failing to monitor such relationships. The Opposition Leader said it is worrying that there is not a single report on the matter while noting that it highlights again, the incompetence of the government to manage the banking sector.
The former President noted that the issue of corporate governance is something he has spoken about during his time in administrative office. He said that the PPP had cases in court for over 10 years against companies which were found to be engaging in “abnormal practices.”
Jagdeo said, “I suspect that some of those cases are still before the court. But it was a nightmare for us. Public corporations need to be held accountable for their actions in the business environment, especially those companies with large shareholdings. I have been talking about this since I was in office.”
The Opposition Leader added, “But you have some aggrieved parties who are now coming out regarding one company. I saw one letter writer in the Kaieteur Newspaper talking about GBTI. But if you look at several companies in Guyana, you will find similar structures, similar issues where there is a lack of good governance. So it should be looked at but not to target one company like GBTI…”
Other stakeholders in the banking industry have voiced their opinions on this matter. Chartered Accountant, Christopher Ram, for example, noted that there needs to be transparency regarding the controlling interest of big businesses in commercial banks.
Ram cited three major conglomerates which needed to be looked at first: Banks DIH Limited, the Beharry Group and Demerara Distillers Limited (DDL).
The Chartered Accountant said that Banks DIH Limited has a 51% stake in Citizens Bank Limited, the Beharry Group indirectly controls the Guyana Bank for Trade and Industry Limited (GBTI), and DDL has common control with Demerara Bank Limited.
Ram said that the Bank of Guyana as the chief regulator should undertake checks these relationships to identify any self-dealings and preferential treatment by these commercial banks. He said that the Bank of Guyana should also enquire why the sale and purchase of foreign currency is not disclosed in the financial statements of the banks and their respective associated companies, clearly a requirement under International Financial Reporting Standards.