Although 2012 is shaping up to be a difficult year for the country, it will not be at the level being seen in Britain and Europe, according to the president of the Barbados Bankers’ Association.
Horace Cobham says that while there is no doubt about the country’s dependence on these markets, he is confident in the stability of the banking and financial system here.
“We have a very sound banking system. We are not in the same place that we are seeing in, say, Greece, Portugal or even Spain for that matter,” he told BARBADOS BUSINESS AUTHORITY in a recent interview.
“Look at Canada. They are said to have one of, if not the safest [banking] systems in the world at this point in time. And that is because there is conservatism when lending, from a risk perspective,” he said.
Cobham, who is also president and country head of RBC Royal Bank (Barbados) Limited and RBTT (Barbados) Limited, noted that like Canada, the Caribbean and Barbados in particular does not sell off its loans as is done in other jurisdictions.
He said this makes it critical for banks to ensure loans can be serviced.
“It is incumbent on us to make sure loans can work today, tomorrow and for the next five years – and therein lies the difference,” he noted.
“But I will [also] say to you that the banking system [here] is the best capitalized and all loans granted are kept on the books. That is why when we talk about delinquency, we talk about loans we have to manage through difficult times,” Cobham pointed out.
In this area, he said, the market itself had generally settled down after a fair amount of turmoil as far as delinquency was concerned.
“We have seen people going into their respective banks and sorting out their financial arrangements in a way that they can still maintain their loan payments and continue to live,” he added.
