Cannonier: banks must step up to help Bermuda
The Opposition leader called yesterday for banks to do more to help Bermuda through a feared economic crisis because of efforts to slow the potential spread of Covid-19.
Craig Cannonier was speaking after HSBC Bermuda, Butterfield Bank and Clarien Bank announced they would cut lending rates by up to half a percentage point.
Mr Cannonier, the leader of the One Bermuda Alliance, said he was “disappointed” by the announcements and that the banks' actions fell well short of what was needed at a time when many workers and businesses faced a significant loss of income.
He added a task force should be formed to work with the banks to hammer out details of a plan to guard against excessive financial hardship for the public.
Mr Cannonier said: “I have faith that Bermuda will pull through this, but we have to work through this together. We can do it.”
The Government in 2009 guaranteed a $200 million preference share issue that helped keep Butterfield Bank afloat in the wake of the global financial crisis.
Mr Cannonier said it was time for that favour to be returned.
He added: “The taxpayers of this island bailed out Butterfield Bank. The taxpayers stepped up and did their part. Now we are facing a potential major crisis and we need the banks to step up boldly.
“If we have people who are not able to work and are unable to pay their mortgages, then how do we address that situation?” Mr Cannonier admitted that the banks could also face hardship that could affect their employees.
He said: “If they cut their rates significantly, then they may say that there will be some people at the banks who lose their jobs.
“We have to work together to make sure this is not the case.”
The Bermuda Bankers Association said last week its four member institutions employed a total of about 1,200 people.
Mr Cannonier said talks with the banks should be aimed at “providing as much relief as possible”, especially to mortgage holders unable to make repayments and businesses trying to keep their doors open.
The Government asked banks to cut lending rates about two weeks ago after US central bank the Federal Reserve cut its influential fed funds rate by half a percentage point. The Fed declared an additional one percentage point rate cut yesterday.
Mr Cannonier said he had spoken to Curtis Dickinson, the finance minister, several times over the weekend and had offered his party's help in sitting on emergency committees.
He added: “We are facing almost a resetting of the economic dial. We all have to pull together to help each other through this. Everyone has a part to play.
“We must remember that we won't be in this position for ever. We just have to do what's necessary to pull through it. We will bounce back.”