Guyanese business professor and accountant, Floyd Haynes will soon be granted a licence to operate a merchant bank here and he hopes that small businesses, especially, will have an alternative to accessing finance, even as the bank targets the wider and emerging large-business sector.
It was Vice President Bharrat Jagdeo during an outreach in Region Two yesterday who made the announcement of the formation of the new financial institution and Governor of the Bank of Guyana, Gobind Ganga, later confirmed it with Stabroek News.
“We just licensed a merchant bank – a Guyanese guy who got it, the licence – and they are setting up a bank,” Jagdeo told the Region Two meeting.
Ganga would add that the licence was “on the verge” of being issued as all the requirements had not yet been met.
“We haven’t issued the licence as yet… but they have met the other requirements and it will be issued once the construction of the building is completed,” he said.
Ganga also informed that “a number of other persons” have applied for merchant bank licences and those were being processed as well.
Haynes, who is the founder and president of Haynes Incorporated – a Washington-based accounting and management consulting firm – that had provided high-level financial and accounting support to clients such as the United States Department of State and the United States Agency for International Development, told this newspaper that he took the investment decision because he sees great opportunity here.
“I just felt there is an underserved community of business persons with a lot of potential; a lot of opportunity and good business plans and there is no way for them to go get funding because the retail banks don’t cater to that market. So there is this emerging business class in Guyana that has a unique set of needs unlike anything the market caters for. It is expanding and there are new opportunities for both us and them.”
He pointed out that local retail banks, where most small businesses go to access financing for their ventures, offer only debt financing, however, most persons are unable to meet the requirements.
“They may have good ideas, good project plans, but they can’t walk in and ask for equity financing because retail banks don’t offer equity financing. These businesses may be at a state where they are looking for both debt and equity financing; you know, where they may be giving up some ownership for financing,” he explained.
“Alternative source of capital is where we would step in. For example, you may take an interest ownership in exchange for the capital and be bought out at a later date. Retail banks are not set up for that. I can create a formal institution to provide the services those people need,” he added.
Another service Haynes’ merchant bank will offer is management of private pension schemes. “I felt there is an opportunity to provide a different level of management for pension schemes and that type of thing. There are a lot of pension schemes which deserve to have alternative management. At the end of the day they can determine where they get the best deal and we want to be that best deal.
“It is essentially identifying a gap in the market and satisfying that need,” he added.
Haynes, who is also a financial analyst, said that he was not afraid to take risks and invest his own capital here because he sees Guyana’s growing economy as a sound business opportunity. “You have to take risks. It is risk capital. There has never been a time in the history of Guyana when there are more opportunities for small businesses. Those small businesses will need capital and we want to be the bank of choice for those businesses,” he stressed.
He also has over 30 years working in Africa and the Middle East assisting in the development of small businesses and implementing transparency and accountability in business and government.
The Certified Public Accountant who holds a MSc. in Financial Economics from the University of Oxford, and a Masters in Public Policy from Harvard’s Kennedy School of Government, is also a partner with local Chartered Accountant Chaitram Ramdihal in the Accounting and Professional Services Firm – Ramdihal and Haynes Chartered Accounting and Professional Services Firm.
Their firm is part of the RHVE consortium of local accounting and auditing firms which recently bid to audit Guyana’s cost oil. The other members of the consortium are Vitality Consulting, and Eclisar Financial & Professional Services (EFP).
