The Virgin Islands Banking Board is close to making its decision on whether to approve the Virgin Islands Community Bank's proposal to buy Chase Manhattan Bank holdings in the U.S. Virgin Islands.
"We expect a decision to be made very quickly," board member Winston Bennett said Friday. "Quickly" probably means "within the next two weeks."
"We had a meeting last week. We gave them (VICB) some questions that needed to be re-answered," Bennett said. "We have developed the last criteria to make our decision on."
The local Banking Board is coordinating its review with the Federal Deposit Insurance Commission, Bennett confirmed. He said he did not know what if any reaction FDIC members had to last week's unflattering profile of Community Bank owner Jeffrey Prosser in the Wall Street Journal.
VICB's purchase of Chase in the territory needs approval from both the federal and the local regulatory agency. The proposed purchase on Chase's other Caribbean holdings are outside their purview.
Included in the V.I. holdings are the four St. Thomas branches, one on St. John and two on St. Croix. Also included is Chase Trade, Inc., a management company for foreign sales corporations, which are subsidiaries of U.S. export companies.
Information contained in the FDIC application, obtained by the V.I. Source under a freedom of information request, shows the two banks formalized their agreement June 30, 1999. They apparently expected approval earlier, since Dec. 15, 1999, appears as a tentative cut-off date for the proposal.
The VICB board members who signed a unanimous resolution in July approving the deal are Prosser and his wife, Dawn Prosser, his long-time business associate Ann E. Abramson, another long-time associate and attorney from Nebraska, John P. Raynor, J'Ada Finch-Sheen, now chief executive officer and an editorial board member on the Prosser-owned V.I. Daily News, and Michael Dow, president and chief executive officer of VICB.
As part of the agreement, both individually and on behalf of his company, Innovative Communications Subsidiary Company, L.L.C., Prosser agrees to guarantee the V.I. Community Bank will fulfill its obligations under the agreement. Those include keeping all the branches open for at least 90 days and offering "comparable employment" to all existing employees for at least one year after the purchase.
In arguing its case for approval by the FDIC, V.I. Community Bank lists its record of loans to territory residents and businesses. It also calls Prosser "a strong community development advocate in his own right," citing as proof the controversial Daily News April 1, 1999, coverage of Prosser's "bail out" for tax breaks proposal.
Figures included in the application to the FDIC evince Chase's position as one of the biggest banking institutions in the territory.
It lists deposits at $357.9 million as of June 30, 1998, "ranking (Chase) second in the USVI behind Banco Popular." Of those deposits, $72.4 million are government deposits and $285.5 million are individual, partnership and corporation deposits. Of that $285.5 million worth of private-sector deposits, $14.4 million are attributable to Chase Trade's FSC accounts, meaning the money is not coming from V.I. residents.
Chase's Eastern Caribbean Regional Banking Group had a total of loans outstanding of $314.8 million as of June 30, 1999, according to the report. Of that sum, $254.7 million were booked to the USVI branches.
The total staff as of Feb. 23, 1999, is listed in the report as 284 – 210 on St. Thomas, 26 on St. Croix and 10 on St. John.
