The Territorial Bank of American Samoa (TBAS) is exempt from Federal Deposit Insurance Corporation regulations.
What does that mean for customers and businesses that plan to bank their money with the government bank?
Gubernatorial candidates Faoa Aitofele Sunia & Larry Sanitoa feel that the administration is not thoroughly explaining the consequences of operating this bank without FDIC protection.
Since the introduction of a bill to establish TBAS was submitted to the Fono, Rep. Larry Sanitoa has been a vocal opponent.
He says local statute requires that any bank set up in American Samoa must be FDIC regulated.
The Tuala-uta faipule explains why he has opposed the government bank .
Sanitoa says FDIC oversight guarantees that customers’ money may be redeemed should there be any unforeseen circumstances confronting the banking institution.
The challengers to Governor Lolo Moliga and Lt Governor Lemanu Peleti Mauga point to ASG’s poor track record with banks
Faoa notes that when ASG operated the Bank of American Samoa back in the days of the Navy, it did not last and was shut down.
He adds that the Development Bank of American Samoa is operating at a loss.
Faoa and Sanitoa believe that the government should never be involved in a banking institution.
The biggest concern for the challengers is that ASG will be depositing all its funds in this bank without FDIC protection.
The government bank is set to open early next month.