Banks report hike in deposits By ALDWIN R. FAJARDO

Despite major setback that hit the local economy in the last two years, local and foreign banks in the Northern Marianas recorded dramatic increase in total deposits with last year’s second quarter figures reaching over $550 million.

Statistics obtained from the Department of Commerce indicated that during the second quarter of 1999, local and foreign banks operating in the CNMI posted an aggregated $554.5 million in total deposits.

This figure is more than $25 million higher than the $528.8 million cumulative government and private deposits recorded during the same period in 1998 for all financial institutions in the CNMI.

There are at least 10 banks — nine are in operation with physical facilities and locations while two were licensed and are operating via their resident agents — in the Northern Marianas at present.

By end-1998, commercial and savings banks in the CNMI registered about $522 million in total deposits, up from the 1997 figure of $481.1 million.

In 1996, financial institutions in the commonwealth recorded only $463 million in total deposits. A closer look at the figures would reveal that the assets have been on a steady increase, according to a business analyst.

A government banking specialist said bank assets have, in fact, been going up since 1994. He said the increase could be sign of a strong banking infrastructure in the Northern Marianas.

The increase may also be attributed to the opening of two major banks — Hong Kong and Shanghai Banking Corp. and First Hawaiian Bank — in 1998.

The strong banking infrastructure in the CNMI is flourishing the financial resources of the Commonwealth to help businesses make it through the current economic upheavals.

Development Authority Chair John S. Tenorio said the partnership between the government and private banks has spelled the difference in the continued survival of businesses in the Commonwealth, despite economic downturn.

In the absence of a healthy economy, Mr. Tenorio said strong partnership between the government and private financial institutions would help even small- and medium-scale businesses survive.

He said while banks have a very conservative market perception, the sector is strong enough to weather the economic slump plaguing the Northern Marianas as they learn hard lessons from the crisis.

Mr. Tenorio added that most of the banks in the CNMI have been doing their share in keeping a sound local economy in the midst of CDA’s limited funds and the worsening Asian financial upheaval.

He pointed out that loan restructuring is one of the many important things being worked out by CDA and the several commercial banks in the island.

He said commercial banks have been much more receptive in helping the community, adding that the sector have been active participants in CDA’s lending programs.