By Katalina Siasau

The Tonga Development Bank is being investigated by the Police regarding an alleged breach of the Banking Act.

Tonga Police confirmed today, 28 May, that they conducted a search at the TDB on Friday, 24 May, while responding to a complaint regarding an alleged breach of the Banking Act at the TDB.

"This matter is under active investigation."

The Police also stated that they would provide no further details at the moment, "in order to protect the integrity of the investigation and to ensure fairness."

Confidential communications leaked

Meanwhile, the TDB in a statement yesterday, attempted to address “Inquiries regarding interactions with National Reserve Bank of Tonga”.

The management said they regretted that confidential communications had been leaked.

"We regret that confidential communications between NRBT and TDB have been deliberately leaked, causing grave misconceptions and unnecessary confusion among our customers and the public."

"These matters should remain confidential and handled professionally and via the proper channels to ensure confidence in the stability of the country's financial system is maintained."

The TDB maintained that the bank is “on track for another year of strong profitability”, with a Liquid Assset Ratio of 15% and Risk-Weighted Capital position of 23% “well above the statutory minimum of 15%”.

They said: “TDB's customers can have full confidence that TDB is financially well-positioned to continue serving the Kingdom as its only locally owned bank.

“TDB's major shareholder has committed to injecting additional capital to support our growth strategy.”

Public concerns

However, neither the TDB nor the NRBT have officially addressed public concerns over a reported move by NRBT Governor to sack the two top officials of the TDB last week. This was after radio and social media in Tonga had reported that the Governor sent the two officials a letter of concern about the TDB's management.

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