By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bank of the Bahamas’ turnaround will take at least 18-24 months, its chairman has implied, with a Restructuring Committee appointed to oversee its progress.

Richard Demeritte, addressing the BISX-listed institution’s annual general meeting (AGM) on Friday evening, said the Committee included two external advisers, as well as the bank’s acting managing director, Renee Davis.

Mr Demeritte did not name any of the committee’s members apart from Mrs Davis, but added that it also included an official from the Ministry of Finance, and would be supported by a Central Bank of the Bahamas representative.

He told the bank’s 3,000 minority investors that the committee had been charged with “monitoring the transformation and providing advice to the bank’s management”, adding that its two external, non-government appointees were “well-respected members of the business and financial services communities”.

Mr Demeritte said the Restructuring Committee was a temporary creation likely to be in place for 18-24 months, “which mirrors the timeline for the transformation strategy and its execution”.

This implies that Bank of the Bahamas’ shareholders may have to wait a little while yet before their investment returns to sustained profitability, following three consecutive years of losses involving more than $100 million in ‘red ink’.

Mr Demeritte, in an attempt to bolster shareholder morale and convince them to keep supporting the bank in its ‘hour of need’, gave a stirring address that was long on rhetoric but short on details and facts.

However, the Bank of the Bahamas chairman revealed that the bank had gained 1,000 new account holders in the two weeks since the Government implemented a policy requiring all new and temporary public sector hires to bank with it.

The rapid increase in account numbers, via a policy that is intended to help prop up Bank of the Bahamas, also raises questions as to whether the Government is starting to embark on a pre-general election hiring spree.

Mr Demeritte, meanwhile, suggested that should Bank of the Bahamas fail, then it would also mean that the Bahamian people have failed.

“We’ve recognised Bank of the Bahamas belongs to Bahamians, and each of us has a responsibility to make it work,” he told the AGM.

“All of the actions, suggestions and discussions will, in some way, provide a unique opportunity to put the bank on a much sounder footing.”

Promising to shareholders that he would “champion the cause of Bank of the Bahamas”, he added: “I believe in Bank of the Bahamas. It’s a part of me. It’s a part of you, whether you accept it or not....

“We can’t allow it to fail. If Bank of the Bahamas fails, then we as a people fail. Let us work together as a team to make Bank of the Bahamas work better for all of us.”

Mr Demeritte also pledged that Bank of the Bahamas would “transform the way we think about customer service and financial performance”.

“Our vision for Bank of the Bahamas is to turn around our financial position and build the bank of the future,” he added.

“We will be an institution laser-focused on realising appropriate shareholder returns with sustainable return on equity and limited credit risk.”

Promising “a fundamental shift” in the bank’s appetite for risk, Mr Demeritte added: “We will also increase our commitment to retail and small and medium-sized businesses through tighter risk controls and ongoing monitoring.

“Our goal is to be a nimble, action-oriented organisation; one that empowers its employees to deliver best-in-class customer service. There should be no question that we will maintain our commitment to the Bahamian people and market, while focusing on our sustainability as a leading financial institution.

“Together, we will reduce impaired assets, pursue safe growth and enable our institution to transform and return to a leading Bahamian financial institution.”