Bankers accuse Jamaican Cambios of Interference in Financial Exchange Rates.

Mr. Hylton has made many arguments supporting the level of charges by Banks. In fact is he started out by criticising Cambios, and their contribution to business and foreign exchange supply in Jamaica.

Then he realizes Cambios have captured 50% of the F.E. market, and the banks wish to recover their position and their business; so he criticises the Cambios saying they are the ones causing the exchange rate to rise or fall. Much does he forget, being an economist and banker, that prices of commodities like foreign exchange, precious metals, rice and other grains, respond to market conditions: Supply and Demand.

I now attach a revised letter to the Editor which is a response to his remarks, “Much Ado about nothing.” Jamaica is a relatively small country, but it is not ‘to do about nothing’

I am surprised to see Mr. Hyltons defence of
fee increases by NCB, claiming firstly, that the fees are ‘largely’ subsidized. I wonder if he understands what he is saying; or who pays the subsidy? If someone from outside your company decides to pay a charge on your behalf, then clearly that is a subsidy:

But, should you make a contribution to your Company, that is added Capital, or an expense of the Company; which means it came from profit. So how can it be called a ‘subsidy’, when the source is yourself?

Mr. Hylton claims that there are alternatives to the costs of making deposits in foreign currency, but he does not say what they are, and frankly I do not believe they exist. You may deposit cheques or drafts, but in the final analysis all debts have to be paid out in cash, in my humble opinion. Then he mentions the costs of packaging and shipping out moneys to overseas banks, which cannot be confirmed as accurate by Brinks or other carriers.

I would also like to point out to him that one of NCB’s Cambio Clients in the country, paid in excess of J$65,000,000 in deposit fees last year and these were all charges the Bank made on US dollar deposits; plus you have all the others, chequing accounts, foreign exchange drafts, and so on; plus purchasing the cash for the client needed another J$ 54,000,000,000; (54 billion). Then If that Company paid the charges now being asked by NCB, it would be somewhere around $100,000,000 per month, (or  billion 1.2 per annum.). Yet Mr. Hylton calls the level of trade from this Cambio “Much Ado about Nothing”.

It seems that in a previous position Mr. Hylton ran into similar difficulties, in the perception of thousands, millions, and billions; I also suspect that his influence on the other banks, is not only detrimental to the affairs of the entire financial community, but also the manufacturing sector. Consider the production and banking assets that were wasted under FINSAC, and the cost of that FINSAC commission which has not yet presented a report; much of the assets are still unaccounted, and the producers are either deceased or out of business.

Ramesh Sujanani.

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