The president and CEO of the Territorial Bank of American Samoa believes maintaining government ownership in the bank serves the best interests of the community.
Government ownership of TBAS, however, is the reason why the bank cannot be insured by the Federal Deposit Insurance Corporation, FDIC. And since the bank was opened seven years ago, lack of FDIC coverage is cited as the main reason why many have not become TBAS customers.
The FDIC protects the money depositors place in insured banks in the unlikely event of an insured-bank failure. Each depositor is insured to at least $250,000 per insured bank. FDIC deposit insurance covers all types of deposits held at an insured bank.
The FDIC has made it clear that unless the government divests its interest in TBAS, it will not obtain FDIC insurance.
During a hearing of the House Commerce Committee on Wednesday, the CEO of TBAS Owen Perry said being a member of FDIC does not guarantee the bank is safe.
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Perry said TBAS has posted two profitable years and this would be the third year that the bank would turn a profit.
The Commissioner of the Office of Financial Institutions Tuasivi John Marsh shared the same view that TBAS should retain its status quo with government ownership. He reminded lawmakers that when Bank of Hawaii pulled out it was impossible to attract another bank to American Samoa.
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