Tonga Development Bank sells $7.5 million shareholding [1]
Saturday, June 8, 2019 - 15:29. Updated on Saturday, June 8, 2019 - 15:46.
A cheque for $7.5 million pa'anga was paid to the Tonga Development Bank from the Public Service Retirement Fund Board (PSRFB) for its purchase of a 15% shareholding in the bank.
The cheque was received by the Minister of Finance Hon. Pohiva Tu‘i‘onetoa following his signing of a Deed of Agreement with Manu ‘Akau‘ola for PSRFB to purchase 15% shares in the bank.
The three shareholders of the TDB are now the Tonga Government 70%, with 15% each for the Public Service Retirement Fund Board and the National Retirement Benefit Fund Board.
Leta Kami, the Chief Executive Officer of the Tonga Development Bank said the sale of shares puts the bank in a better position to fund loans into millions of Pa’anga.
Second release
The Public Service Retirement Fund Board is the second shareholder to have bought shares of the Tonga Development Bank from government since June 2018.
On 26 July 2018, Hon. Tu‘i‘onetoa announced that government had approved for the National Retirement Benefit Fund Board to take up 15% unsubscribed shares at the Tonga Development Bank.
The move by Government, the owner of the Tonga Development Bank, to sell shares started when it tabled into parliament the Tonga Development Bank Bill 2018, to remove the TDB from the Ministry for Public Enterprises (the Minister is Dr Saia Piukala) and to come under the Ministry of Finance.
The Tonga Government was the sole shareholder of the Tonga Development Bank but on 26 July 2018 the Minister of Finance approved for the National Retirement Benefit Fund Board to take up 15% unsubscribed shares at the Tonga Development Bank, and the shares were transferred on 28 August 2018.
Following on from the signing of the Deed of Agreement by the Minister of Finance, Hon. Tu‘i‘onetoa, Manu ‘Akau‘ola and Michael Bloomfield from the Public Service Retirement Fund Board on 31 May, there are now three shareholders of the Tonga Development Bank.
Loans for enterprises
Leta Kami, the Chief Executive Officer of the Tonga Development Bank was very happy with the decision for the TDB to have more shareholders, which would enable them to lend out bigger amounts of money, “particularly to government enterprises which demand millions of pa‘anga loans for some of their construction projects.”
Leta was confidence that the TDB is now in better position to compete with other commercial banks.
King’s consent
Meanwhile, on the hindsight of things, Parliament finally passed the Tonga Development Bank Bill on 13 March 2019, and it remains one of a number of Bills that are still waiting for the consent of His Majesty in Privy Council.