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This blog is brought to you by Gilbert & Samuels Company Limited, a financial advisory services and consulting company based in Suva, Fiji.
To contact the authors of this blog, please call telephones (679) 3342719, (679) 3544897 or e-mail info@gilbert.com.fj.


Tuesday, October 26, 2010

Reserve Bank of Fiji issues Risk Management Policy for Insurance Companies

The Reserve Bank of Fiji has recently issued a Risk Management Policy governing the operations of companies licensed to conduct insurance business in Fiji. The policy puts in place requirements that cover the identification, assessment and management of risks by insurance companies including the development of appropriate risk management frameworks, policies and processes to manage risks.

One of the areas our company, Gilbert & Samuels Company Limited, consults on is the area of risk management. We can help companies identify risks, evaluate those risks and put in place strategies and controls to manage any residual risks that remain within the company.

We can also develop appropriate risk management policies and processes for companies to help them with managing risks within their businesses.

For more information, you can call our office on telephone (679) 3342719 or email info@gilbert.com.fj.

Note : Search for our company, Gilbert & Samuels Company Limited, on Facebook. We post informatoin on the services we offer and the work we are currently doing there.

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ANZ Interest Rates (updated 26.10.09)

Schedule of interest rates released by ANZ Fiji are as follows:

  • Business Index Rate - 9.95%;
  • Residential Property Loan : Standard Variable Rate - 7.75%, 1 Year Fixed Rate - 7.25%;
  • Investment Loan : Standard Variable Rate - 8.25%, 1 Year Fixed Rate - 7.50%;
  • Personal Loans : Secured - 11.00%, Unsecured - 15.00%;
  • Small Loans : Unsecured - 19.50%;
  • Retail Term Deposits: 9 months to 1 year - 2.25%, 1 to 1.5 Years - 3.75%, 1.5 to 2 Years - 3.75%, 2 Years to 3 Years - 4.00%.

Interest rates are on a per annum basis and may be varied by ANZ without prior notice.

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Monday, August 02, 2010

Westpac Interest Rates (updated 2.8.10)

Schedule of interest rates released by Westpac Fiji are as follows:

  • Business Lending Rate - 9.99%;
  • Residential Property Loan : Variable Rate – 7.75%, 1 year Fixed Rate – 7.25%;
  • Investment Loan : Variable Rate - 8.25%, 1 year Fixed Rate - 7.25%;
  • Retail Term Deposits : 6 to less than 9 months - 2.25%, 9 months to less than 1 year - 3.00%, 1 year to less than 1.5 Years - 3.50%, 1.5 years to less than 2 Years - 3.75%, 2 years to less than 3 Years - 4.00%.

Interest rates are on a per annum basis and may be varied by the bank without prior notice.

Companies interested in developing new or reviewing their current strategic plans can contact us on telephones (679) 3342719 or (679) 9921427 or email info@gilbert.com.fj.

We also carry out consultancies on capacity assessments and risk management.

At present we are involved in developing an Organisational Review and Strategic Plan Consultancy.

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Monday, February 22, 2010

Colonial National Bank Interest Rates (Updated 22.2.10)

Schedule of interest rates released by Colonial National Bank are as follows:
  • Business Banking Base Rate – 9.20%;
  • Residential Property Loan : Variable Rate – 8.25%, 1 Year Fixed Rate – 7.25%;
  • Investment Loan : Variable Rate – 8.25%, 1 Year Fixed Rate – 7.25%;
  • Retail Term Deposits: 9 months - 5.00%, 1 year - 3.50%, 1.5 Years - 3.75%, 2 Years - 4.00%, 3 Years - 4.50%.

Interest rates are on a per annum basis and may be varied by the bank without prior notice.

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Monday, February 01, 2010

Capacity Assessment Consultancy

One of our products is Capacity Assessments of organisations. We have previously carried out this type of consultancy for UNICEF and UNAIDS.

Capacity Assessments are done to evaluate whether an organisation has the capacity, skills and expertise to achieve the objectives and functions that it has set out to do.

Donors are usually interested to have an independent assessment done to evaluate whether the NGO or project that it is intending to fund has the capacity to deliver the intentions and objectives for which the funding is to be provided. In that regard, it usually calls upon an independent person to carry out a capacity assessment on that particular organisation.

Another area where capacity assessment can be utilised is to find out whether an organisation has the capacity, skills and expertise to be able to deliver some function that it intends to provide in the future.

At the moment, we are currently doing a capacity assessment consultancy for Dominion Finance Company Limited.

If you are interested in this type of consultancy, pls email us on info@gilbert.com.fj or call telephones (679) 3342719 or (679) 9921427.

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Westpac Interest Rates (updated 1.2.10)

Schedule of interest rates released by Westpac Fiji are as follows:
  • Business Lending Rate - 9.99%;
  • Residential Property Loan : Variable Rate – 8.50%, 1 year Fixed Rate – 7.75%;
  • Investment Loan : Variable Rate - 8.50%, 1 year Fixed Rate - 7.75%;
  • Retail Term Deposits : 6 to less than 9 months - 2.25%, 9 months to less than 1 year - 3.00%, 1 year to less than 1.5 Years - 3.50%, 1.5 years to less than 2 Years - 3.75%, 2 years to less than 3 Years - 4.00%.

Interest rates are on a per annum basis and may be varied by the bank without prior notice.

Companies interested in developing new or reviewing their current strategic plans can contact us on telephones (679) 3342719 or (679) 9921427 or email info@gilbert.com.fj. We also carry out consultancies on capacity assessments and risk management.

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Wednesday, January 20, 2010

Colonial National Bank Interest Rates (Updated 18.1.10)

Schedule of interest rates released by Colonial National Bank are as follows:
  • Business Banking Base Rate – 9.20%;
  • Residential Property Loan : Variable Rate – 8.25%, 1 Year Fixed Rate – 7.25%;
  • Investment Loan : Variable Rate – 8.25%, 1 Year Fixed Rate – 7.25%;
  • Retail Term Deposits: 9 months - 5.00%, 1 year - 3.50%, 1.5 Years - 3.75%, 2 Years - 4.00%, 3 Years - 4.50%.

Interest rates are on a per annum basis and may be varied by the bank without prior notice.

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Thursday, December 31, 2009

Reserve Bank of Fiji issues guidelines for local Boards and on microfinance for banks

The Reserve Bank of Fiji has issued three new policy guidelines for licensed banks. The guidelines include :
  • Minimum Guidelines for the Establishment of a Local Advisory Board;
  • Policy Guideline on Complaints Management; and
  • Minimum Requirements for Commercial Banks on Internal Micro finance Divisions and Units.

Of note are the guidelines for the establishment of local advisory boards and that for establishment of internal micro finance divisions by banks operating in Fiji.

Currently, whilst a branch of a foreign bank operating in Fiji is headed by a General Manager (or something similar), he/she and the Fiji operations reports directly to a division of the bank that looks after its foreign operations, at the bank's country of incorporation.

Policies on trading and business are currently established by the foreign branch bank's head office with its Fiji operations requested to comply with those. The establishment of local advisory boards should facilitate the more rigorous review of the applicability of some of those policies to Fiji.

An advantage of a local advisory board is that it would, hopefully, also look into more proactive product development that best suits the customer profiles of Fiji banks, rather than the "advanced and complicated" needs of a foreign customer.

With regard to the other policy requiring the establishment of internal micro finance divisions within banks in Fiji, given Fiji's current economic and business environment, focusing on the establishment of micro and small enterprises and providing necessary training to those interested in how to run a business, would be of immense benefit to the country.

In recent years, most people have been displaced off land and from regular paid employment. Instilling a business and entrepreneurial focus on such citizens will help promote a financially independent attitude that will drive them to fend for themselves by running their own businesses. This will reduce the "hand-out mentality" and a heavy reliance on Government and social security and social welfare safety nets.

Looking at, and developing other incentives to promote the development of small and micro enterprises, would be of benefit to Fiji in the areas of :

  • subsidised training for budding business people and entrepreneurs;
  • subsidised taxes (perhaps for the first few years of operations until businesses get on their feet);
  • setting up commercial tax free zones for such small businesses, subsidised procurement prices for essential business overheads; and
  • setting up centres where business owners can learn from each other's experiences and share their own experiences and challenges as well.

The move by the Reserve Bank of Fiji in establishing these policies are commendable and we hope that the objectives of these various policies are met.

The guidelines take effect from 1 January 2010.

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Friday, November 27, 2009

Banks to celebrate as Reserve Bank of Fiji removes interest rate controls

The Reserve Bank of Fiji has announced that, with effect from 1 January 2010, it will be removing the interest rates controls that it imposed on banks in Fiji in April 2009.

The announcement is expected to cause celebrations amongst banks in Fiji who had been under pressure to reduce their interest spreads and margins since the controls were put into effect.

The change in policy stance rose after the IMF made comments regarding the policy mix used by the central bank to conduct monetary policy and urged the authorities to "utilize more market-based instruments". (Quote is taken from IMF Statement after the conclusion of its Article IV consultations in Fiji, which has been posted earlier on this blog).

In recent years, the Reserve Bank of Fiji had been reinstating direct controls to contain credit (e.g. increases/reductions in Statutory Reserve Deposits and controls on interest spreads/margins), after earlier making a move to use more market based instruments.


An excerpt from today's press release from the Reserve Bank of Fiji is provided below.

"The lending rate and interest rate spread polices will be removed. In April 2009, the Bank announced that the weighted average lending rates of banks and other lending institutions should be brought down to 31 December 2008 levels. All commercial banks have now complied with the lending rate policy of the RBF. In addition, banks are on target to meet the 4 percent interest rate margin policy by December 2009.

In removing the lending rate and interest rate spread policies, Mr. Reddy stated that “all commercial banks are advised to maintain the trend in lending rate and any increase in spread above 4 percent in the future will have to be fully justified and explained to the RBF."

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IMF Concludes Article IV consultations in Fiji

Taken from the International Monetary Fund website on this link.

The statement raises concerns regarding :
  • constraints on future growth in Fiji and how the "outlook remains highly uncertain due to political developments, the fragile nature of the global recovery, volatility of commodity prices, the risk of natural disasters, and the complex structural reform agenda";
  • downside risks including how "increased liquidity in the banking system poses risks of inflation, macroeconomic instability, and a loss of competitiveness";
  • relevance and adequacy of monetary policy instruments used;
  • the level of government debt and its sourcing mostly from FNPF funds;
  • sustainability of FNPF to pay pensions at current rates and its use to fund government debt.

"Statement of an IMF Staff Mission at the Conclusion of the Article IV Discussions with Fiji, Press Release No. 09/427November 23, 2009

The following statement was issued today in Suva after the conclusion of an International Monetary Fund (IMF) staff mission to Fiji:

“A team led by Mr. Ray Brooks, Division Chief in the Asia and Pacific Department of the IMF, visited Suva November 10 – 24 to hold Article IV discussions with the government and other stakeholders.1 The team met with Prime Minister Bainimarama, Reserve Bank of Fiji (RBF) Governor Reddy, Acting Finance Minister Sayed-Khaiyum, Finance Secretary Prasad, other senior government officials, and members of the private sector and civil society. Representatives from the Asian Development Bank and the World Bank also participated in the meetings. The team expresses its appreciation to the authorities for the constructive discussions.

“Economic growth in Fiji has been sluggish in recent years due to political developments, delays in structural reforms, and worsening terms of trade. Job growth has been slow and unemployment rose to 8½ percent in 2008.

“The economy is expected to contract by 2½ percent in 2009 as the impact of the global crisis has been exacerbated by floods that damaged crops and tourist infrastructure early in the year. GDP growth of 2 percent is likely in 2010, driven by the rebound in tourism, the devaluation, the global recovery, and rebuilding after the floods. Growth over the medium-term should rise to 2½ percent with fiscal consolidation and progress on structural reforms.

“Fiji, however, faces considerable downside risks given its external vulnerabilities. Increased liquidity in the banking system poses risks of inflation, macroeconomic instability, and a loss of competitiveness. The growth outlook remains highly uncertain due to political developments, the fragile nature of the global recovery, volatility of commodity prices, the risk of natural disasters, and the complex structural reform agenda.

“We commend the authorities for their efforts to limit the overall deficit in 2009 to the budgeted level of 3¼ percent of GDP. This is being achieved by containing expenditure in the face of an unexpected 10 percent fall in revenue. However, central government debt, at over 50 percent of GDP, is high by regional standards. In addition, government has contingent liabilities of around 15 percent of GDP.

“Fiscal consolidation is needed to reduce central government debt to the government’s target of 45 percent of GDP over the medium term. Limiting the 2010 budget deficit to around 2 percent of GDP—excluding costs associated with civil service reforms—would begin to reduce the debt-to-GDP ratio. In the medium term, expenditure can be contained through a well-designed civil service reform and revenue can be strengthened by rationalizing tax incentives. Transparency in fiscal reporting should be improved by widening the coverage of the budget and publishing quarterly reports on the fiscal outcome.

“Monetary policy should be tightened to contain inflation, protect the reserve position, and lock in the competitive gain from the devaluation. Inflation is projected to rise to 7 – 8 percent year-on-year by early 2010 and any further upward pressure on prices could lead to higher wage demands and macroeconomic instability. Given these risks, the recent increase in the statutory reserve deposit ratio is a welcome step. But further measures are needed to absorb excess liquidity and utilize more market-based instruments. We endorse the authorities’ review of the RBF Act to provide the RBF with more independence.

“The Fiji National Provident Fund (FNPF) should be reformed to make it actuarially sound. The generous rate of conversion of benefits to annuities should be reduced and management should be made independent of government and responsible to beneficiaries. The government should reduce its reliance on the FNPF for financing and the FNPF should not be used to finance public enterprises since these actions undermine the fund’s soundness. We support the government’s intention to conduct a comprehensive study to guide its reforms of FNPF.

“The authorities are planning sweeping structural reform that is required to spur growth, create jobs and reduce poverty. Priorities are civil service, public enterprise and land reform, and price liberalization. The social impact of redundancies arising from civil service and public enterprise reform, and the impact of price liberalization, should be mitigated through well-targeted subsidies to vulnerable groups. The government’s decision to corporatize water, procurement and printing services is a very positive step.

“The IMF Executive Board is expected to conclude the Article IV consultation discussions in January 2010.”

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