In the National Budget; last Friday the Prime Minister announced that a new commercial bank will enter the market in Fiji early next year: the Home Finance Company Limited (HFC). He stressed that this won’t be just any bank; this bank will belong to the Fijian people. The FNPF owns 75 percent of HFC, and the Unit Trust of Fiji the other 25 percent. “Truly it will be a bank that belongs to all Fijians, said the Chairman of HFC, Mr Tom Ricketts.
“This morning is another historic moment in the history of HFC, as we have been presented with a formal banking licence certificate by the Governor of Reserve Bank of Fiji, he said.
Governor of RBF Mr. Barry Whiteside (left) presents Banking Licence Certificate to HFC Board Chairman Mr. Tom Ricketts (right).
Fiji has long been considered to be the hub of the Pacific with its geographic location and advanced developments compared to other Pacific Island Countries. We, as a nation have a lot of potential in all dimensions of economic growth, said Mr Ricketts. However, it was sad to note that up till now we do not have a local Commercial Bank. Consequently banking has been on the agenda of HFC for some time, he said.
In 2011, an independent feasibility study was carried out by KPMG. This led to a recommendation stating that there was room for a local bank in Fiji. Therefore; in the Financial Year 2013, meeting all the regulatory requirements for the application and making submission to the RBF became the key focus of the company.HFC had to put in appropriate action plans to meet those conditions and I am pleased to say and as stated by the Governor; last Friday, we have met all the conditions, said Mr Ricketts.
He stated that one of the conditions of the approval was to form a strategic partnership with a well-established international bank, and this took some time. However, after due diligence and clearance by the Reserve Bank of Fiji, we have formed a management partnership with DFCC Bank of Sri Lanka. DFCC was incorporated by an Act of Parliament in 1955 and is Sri Lanka’s first specialized development bank. It also has a subsidiary commercial arm, DFCC Vardhana Bank with 132 branches and 1300 employees, added Mr Ricketts. “Through this collaboration, we expect to benefit from the competencies and capabilities in the areas where there are gaps especially in information technology and corresponding bank”, he added.
We have also carried out a health check of our information technology by an independent information Technology Company with the report suggesting a change of system to suit our banking needs, said Mr Ricketts. HFC, after proper due diligence and governance process, has secured a banking solution from an Australian company, Ultra Data Australia Pty Limited.
Other conditions included a detailed financial viability, enhancement of the governance framework, and support of the shareholders which we have attended to. “We at HFC are excited and strongly believe that there is huge potential for us as a local institution and we will ensure that there is something different for our existing and potential customers. “As mentioned by the Prime Minister, HFC with strong and transparent governance, will have to compete in the marketplace with other commercial banks and operate as a profitable business. We are quite confident of this” said Mr Ricketts. He also emphasized that the difference is that the shareholders are the people of Fiji , and the profits will remain in the country . On the products and services, he stated that they would be competitive.
He thanked the shareholders, Fiji National Provident Fund and Unit Trust of Fiji, Members of the Board for their valuable guidance, support and prudent oversight. “We put on record our appreciation for the continued support and guidance received from the Government, RBF, DFCC Bank, Ultra Data Australia Pty Limited and various other business partners ” he said. He also placed on record his appreciation for the trust and support of HFC management and staff, customers, and the community at large.
HFC has been existence for over 51 years. The bank is expected to commence operation from early next year; and the dates will be announced later.