The Minister of Finance today revoked the licence of Capital Bank International. In a letter to Mr. De Bourg, the Minister cited several reasons for his decision including the following:
• Capital Bank International Ltd. did not maintain a minimum paid up or unimpaired capital of at least five million dollars ($5,000,000) as required by Section 13(1) of the Banking Act.
• Capital Bank International Ltd. did not maintain the minimum capital adequacy ratio of risk weighted assets to capital of eight percent (8%) in accordance with Section 15(1) of the Banking Act.
• Capital Bank International Ltd. breached the limit set by Section 16(1)(a) of the Banking Act, for large exposures to any one borrower or group of borrowers.
• Capital Bank International Ltd. failed to ensure that the property pledged as security in respect of the Bank’s largest loan exposure of eighteen point three seven million ($18.37m) to Native Hut, a related party, was adequately insured. This is a breach of Section 16(2) (a) of the Act, which requires security for any loan in excess of 15% of unimpaired capital to be fully covered by Insurance.
Following the revocation, the Minister acting on the recommendation of the Eastern Caribbean Central Bank appointed Mr. David Holukoff as Receiver of the Capital Bank International Ltd. It is expected that Mr. Holukoff will make a recommendation to the Minister to either reorganize or liquidate the Bank.
It is anticipated that whatever steps are taken in relation to the future of the Bank will give due regard to the best interests of depositors, creditors and investors.
The Ministry of Finance shall continue to keep all interested parties and the public informed on all developments in relation to this matter.
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