Bermuda Commercial Bank is in the final stages of negotiations with a potential buyer.

The bank, formerly led by businessman John Deuss, has seen its profits drop 34 percent at Bermuda Commercial Bank after savers put there money elsewhere because of concerns about an investigation into alleged money laundering and other illegalities involving its main shareholder First Curacao International Bank.

The Bermuda bank’s half-year profits up to the end of March slumped from $4.25 million to $2.79m.

It has also registered declines in its total revenue and net interest income.

The downturn in fortunes has been blamed on a loss of customer confidence caused by a “perceived connection” between the Par-La-Ville Road based bank and Mr. Deuss’ First Curacao bank, which last September came under investigation by Dutch and British authorities regarding a number of alleged illegal banking activities.

Long-time Bermuda resident Mr. Deuss resigned as chairman of Bermuda Commercial Bank last October, as did two fellow directors who also had the links with the First Curacao bank. The investigation into First Curacao International Bank is ongoing.

In a statement the Bermuda bank said it believes consumer confidence will improve, particularly when a new buyer for the bank is announced.

Discussions with a potential buyer of the bank are said to now be in the final stages.

“This downturn can largely be attributed to lower client deposits following the announcement in September 2006 that First Curacao International Bank (FCIB), the bank’s main shareholder, was under investigation for alleged money laundering and other illegal activities.

“Bermuda Commercial Bank was not implicated in any way by the events surrounding FCIB. The decrease in deposits is expected to be short-lived as consumer confidence improves and a new buyer is announced.”

Total revenue went down $8.82 million to $7.80 million at the bank year-on-year, and net interest income was lower at $5.03m compared to $5.58m.

“While BCB was hurt by its perceived connection with FCIB, the bank has seen significant improvements in customer deposit levels since initial customer reaction to the investigation of FCIB.”

Last October Butterfield Bank expressed an interest in buying Bermuda Commercial Bank but within a few weeks announced it was no longer interested.

Regarding its sale, the bank said this week: “Since summer 2006 the bank has ought potential purchasers both locally and internationally.

“This process has taken longer than originally expected but we are pleased to announce discussions have now reached the final stages.”