My contention remains it is unjustifiable for the ordering of products by Banks DIH from the Netherlands to be routed through Florida

It is commendable that Banks DIH Limited has responded, in a full-page ad, to my recent commentaries on the company. Unfortunately, the membership, readership and the company’s reputation would have been better served by less obfuscation, diversion, distortion and ad hominem attacks. Let me state categorically that while it might be a fear, it is certainly not a fact that I have ever been an advisor to the Guyana Securities Council. The allegation was mischievous and false.

Let me state again and, hopefully for the last time, that Banks has personal knowledge of blandishments and carrots offered to me some years ago when I challenged the Company’s short notice for an annual general meeting. My response was that a notice is a personal matter, and it was outside the powers of an individual shareholder to waive a statutory right of any other shareholder.

I will now briefly respond to the substantive major points enumerated in the full-page ad.

1. Re-routing transactions through Florida. The ad appears to convey the impression that the court legitimised this extensive series of transactions. The court did no such thing. The sole issue before the court was whether the payment of commissions of $562,123,894 between 2009 and 2016 arose outside of Guyana and were therefore not subject to withholding tax. My contention then and now is that it is unnecessary, wasteful and unjustifiable for the ordering of products from the Netherlands to be routed through Florida. Nor is it credible that a supplier of decades standing “does not treat with [Banks DIH Ltd] in relation to financial matters,” as the company swore in an affidavit. Banks DIH is not a pariah company nor is Guyana an AML-blacklisted country. My concern was evaded in a maze of obfuscation.

2. The new holding company. I questioned the decision to convert Banks DIH Limited into a private company. What the directors do not tell us is that the application for the “arrangement” was made to the Court ex parte, despite the fact that Banks has two regulators directly, and four regulators as a group. Yet, the company did not, from the public records, notify any regulator. Evading responsibility for this simplistic adventure, the ad states that “the decision was made pursuant to advice from BDO, accountants.”

The company boasts that the decision for the conversion had 99.9% support. Yet, shareholders engaged me privately complaining that they do not understand the nature of the transaction. When I suggested questions that could be asked of the directors, the response was “you know this place.”

3. Payment of dividends. My concerns were about the company’s dividend payout ratio which is among the lowest of public companies in Guyana and the Region, and about the transaction cost of paying a dividend of less than a dollar on small shareholdings. Here is an example. Say that the company pays an interim dividend of $0.45 per share to a non-resident person who owns one thousand shares. That is $450 from which withholding tax of 20% has to be deducted, converted to foreign currency, and the net paid over. That leaves the shareholder with less than two US Dollars. Again, evasion and obfuscation.

4. A share re-purchase agreement of December 2016. My question was the reason for paying more than the market price under a share repurchase agreement. That speaks for itself but like the company did then and again now, it evades the real issue and its only recourse is a personal attack and a veiled threat of reporting me to the Institute of Chartered Accountants of Guyana. What an undignified response.

In my Business and Economics Commentary column this coming Friday, I will be publishing an open letter to the Company’s Audit Committee Chairman of my concerns as the holder of 117,000 shares in the Company.