PHILIPSBURG–St. Maarten’s General Pension Fund/Algemeen Pensioenfonds St. Maarten (APS) has identified a need for St. Maarten’s own Investment Bank (SMIB). APS hosted a round table discussion on the topic on Friday, June 8, assisted by financial market experts MGM Source of Aruba for stakeholders from the financial and business community.
Prime Minister Leona Romeo-Marlin and Minister of Finance Michael Ferrier were present, in addition to representatives of local banks, insurance companies and institutional investors.
The SMIB would help match supply and demand in the country’s financial market. Especially in the aftermath of Hurricane Irma, an Investment Bank can recognise and act on investment opportunities that promote the sustainable development of the Dutch side of the island, according to a press release from APS on Tuesday.
“SMIB will serve as a partner for economic development, inducing ventures on St. Maarten, in an independent manner. The SMIB will bridge the gap that now exists between investors on the one hand, who are looking for investment opportunities, and existing companies and new entrepreneurs in need of financing,” said APS Managing Director Nadya Croes-van Putten on Tuesday.
Dividing a loan over different creditors or “syndicating” to spread risk and pool capital will be one of the SMIB’s main activities. It will provide advice and structure more complex financial deals where needed. By doing so, it will serve developers, entrepreneurs, financiers, the government, government-owned companies, multinational companies and others. As a result, St. Maarten will be able to develop new industries and enhance existing ones to become an even stronger player in the Caribbean.
“Institutional investors like the General Pension Fund and others have large sums available to invest in our country. However, good projects are hard to come by, and different investors have to cooperate to spread their risk. The round table’s objectives were to promote discussion, gather feedback from the stakeholders and gauge the interest in the SMIB,” said Croes-van Putten.
To elicit discussion, a position paper on the tasks and goals of the SMIB was distributed to the stakeholders and various presentations were held. The event was kicked off with opening speeches by APS Chairman Franklyn Richards and Minister Ferrier, followed by a presentation by Croes-van Putten and APS board member Arjen Alberts offering insight into the SMIB’s position.
The presentations held during the round table served as further guidance for the discussions. Pritha Hariram of Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO), also known as the Dutch Development Bank, in the Netherlands indicated through a Skype presentation what her experience in FMO has been like and the relevant lessons learned.
One example of an investment bank in the Caribbean region, working in sync with national development, is the Aruban Investment Bank. In a pre-recorded video interview, the first Prime Minister of Aruba, Henny Eman, explained what Aruba’s motives were 30 years ago to establish the Aruban Investment Bank (now AIB Bank). Eman drew a parallel between Aruba’s dire situation when the Lago refinery closed, and present-day St. Maarten in the wake of Hurricane Irma.
AIB BANK N.V. Managing Director Frendsel Giel explained how the bank works today, what the challenges were over the years and what main lessons had been learned to ensure continuity going forward.
“Mr. Giel offered some very relevant words of advice and recommendations for the SMIB going forward. The stakeholders were very positive and engaged toward the initiative, resulting in interesting discussions throughout the afternoon.
“The preparatory works will proceed to translate the feedback obtained throughout the round table and the preceding stakeholders’ consultations, to finalise the business plan and feasibility phase. A firm establishment plan with APS and participating stakeholders will be the result,” stated Croes- van Putten.
During her closing remarks, she called on the Minister of Finance, the Council of Ministers and the stakeholders to join the APS initiative for the SMIB toward successful incorporation for the benefit of St. Maarten. The stakeholders, representing government and the financial and business community, all seemed to subscribe to the fact that the SMIB would be very valuable for the sustainable development of the island, which in turn will serve the community as a whole.