Home' Trinidad and Tobago Guardian : July 9th 2013 Contents A15
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WASHINGTON---Regulators want to
require eight of the largest U.S. banks to
meet a stricter measure of health to
reduce the threat they pose to the
The Federal Reserve, the Federal
Deposit Insurance Corp and the Office of
the Comptroller of the Currency are
expected to propose today that banks
increase their ratio of equity to loans and
other assets from three per cent to five or
six per cent.
Equity includes money banks receive
when they issue stock, as well as profits
they have retained.
The rule would apply to eight US banks
that are considered so big and
interconnected that each could threaten
the global financial system: Goldman
Sachs, Citigroup, Bank of America,
JPMorgan Chase, Wells Fargo, Morgan
Stanley, Bank of New York Mellon and
State Street Bank.
The move follows action the central
bank took last week to increase the capital
large banks must hold as a cushion
against risk. Other regulators are also
expected to adopt that rule. It would
require the banks to maintain high-quality
capital equal to 4.5 per cent of their loans
and other assets.
The higher capital requirements were
mandated by Congress in the financial
overhaul law. They also meet international
standards agreed to after the financial
US regulators want stricter rule for 8 big banks
Central Bank Governor Jwala
Rambarran yesterday called on
the business community to stop
sitting on the sidelines and
start investing in the local
"I commend these business
leaders for their vote of confi-
dence in the country's economic
prospects, but it is not enough.
We need the entire business
community to stop watching
and commenting on the game
from the sidelines," he said.
He was speaking yesterday at
a seminar on Competitiveness
and Sustainable Development,
hosted by the T&T American
Chamber of Commerce
(AmCham T&T) at the Hilton
Hotel and Conference Centre,
At the same time he gave a
list of projects that he said that
have given the economy a lifeline
and will inject confidence.
He pointed to the $500 mil-
lion joint venture between Mul-
ticinemas Trinidad Ltd and JT
Allum Group of Companies to
develop the "C3" movie and
shopping complex in Corinth,
There is also the ANSA McAL
clay plant which costs $400 mil-
lion, he said.
He spoke about a joint venture
among Neal & Massy, the Russ-
ian firm Severstal International
and Meltadom from the
Dominican Republic to build a
vertically integrated iron and
steel complex on Union Estate,
He also spoke about Neal &
Massy's project developmental
agreement with Mitsubishi Cor-
poration, Mitsubishi Gas Chem-
icals Company and the Govern-
ment of T&T to construct and
operate plants to produce
Methanol and Dimethyl-Ether
(DME) at Union Estate, La Brea
at a cost of US$850 million.
"We are already seeing signs
of such confidence. At one end
of the business spectrum, small
firms have been mushrooming
in various clusters around the
country including Charlieville,
Felicity, Tunapuna, Sangre
Grande, Rio Claro and
Penal/Debe. Some of these small
firms are in retail and distribu-
tion. Others are in construction
and energy services," he said.
He warned the private sector
against over reliance on the state
and said the local business com-
munity must also play its part
in wealth creation.
"We are not the only game in
town. I wish to remind you all
that, through its monetary pol-
icy, the Central Bank, can influ-
ence aggregate demand in the
economy. But monetary policy
cannot solve deeper structural
problems or lift the growth
potential of the economy," he
NEW YORK---Oil prices slipped yesterday as supply
worries eased after announcements that a Libyan
oilfield and an Iraqi pipeline would resume oper-
ations, but the dollar s decline helped gold and cop-
per rebound from last week s steep slide.
Among grains, US corn prices rose on worries
about forecasts for stressful Midwest heat later in
the month and new-crop soybeans followed corn
higher. Wheat advanced on demand for US grain
exports and concerns about crops in Russia.
In New York's soft commodity markets, ICE raw
sugar futures turned higher for the first time in over
a week, bouncing on chart-based buying. And Arabica
and Liffe robusta coffee climbed on support from
US dollar softness.
The 19-commodity Thomson Reuters-Jefferies
CRB index jumped to its highest level in two-and-
a-half weeks, rising nearly 0.7 per cent with metals,
grains and some softs markets.
Brent crude oil was down as the announced return
of a Libyan oilfield and an Iraqi pipeline eased concerns
about global oil supplies. The decline followed an
early rally to a three-month high above US$108 a
barrel after deadly protests in Egypt.
Libya's major Sharara oilfield will resume operations
after an agreement was reached with the armed group
that shut it down last month, and a pipeline from
Iraq to the Turkish port of Ceyhan will resume oper-
ations in two to three days following an interruption
caused by a leak.
Brent, the European benchmark, settled down 29
cents at US$107.43 a barrel, after hitting US$108.04
earlier, its highest since April 4. US crude slipped 8
cents to end at US$103.14 after touching a new 14-
month high of US$104.12.
"In spite of a slightly lower close, the crude markets
are still receiving underlying support off of a need
to maintain some geopolitical risk premium related
to civil unrest in Egypt," Jim Ritterbusch, president
of Ritterbusch and Associates in Galena, Illinois,
wrote in a research note.
Meanwhile, gold jumped as the dollar's rally was
interrupted and investors found value after bullion
prices fell to one-week lows on Friday. Concerns that
the US central bank could soon begin cutting its
monetary stimulus program pressured gold.
Bullion had fallen ten per cent since last month
when Federal Reserve Chairman Ben Bernanke sug-
gested the US economy was recovering enough for
the Fed's US$85 billion monthly bond-buying stimulus
measures to be reduced later this year. Such a move
would bolster the dollar, making gold less attractive.
But dollar weakness lifted spot gold 1.07 per cent
to US$1,236.36 per ounce by 4.15 EDT (2015 GMT).
The US dollar edged off three-year highs against
major currencies, but looked poised to resume gains
after last week's strong US jobs report boosted expec-
tations that the Federal Reserve would scale back
stimulus. US employers added 195,000 new jobs to
their nonfarm payrolls last month, indicating that
improvement in the jobs market remains on track,
according to Labor Department data released on Fri-
Oil dips as
in local economy
ANSA McAL group chief operations officer Gerry Brooks, second from right, makes a
point yesterday that attracts the interest of American Chamber of T&T (AmCham)
president, Hugh Howard, left, Central Bank Governor, Jwala Rambarran and
Executive Director, Centre for Competitiveness, Indera Sagewan-Alli at the AmCham
monthly meeting held at Hilton Trinidad, yesterday. PHOTO: SHIRLEY BAHADUR
Rambarran calls on business community to...
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