Merger Committee Formed to Oversee Restructuring ofSuriname's State-Owned Banking Sector.

Business Editors

PARAMARIBO, Suriname--(BUSINESS WIRE)--Feb. 18, 2000

The Central Bank of Suriname, as part of the ongoing initiative to strengthen and modernize the country's financial sector, has announced the formation of an independent Merger Committee to oversee the restructuring

of the country's State-owned banks. The formation of the Merger Committee constitutes the second stage in the implementation of the Action Plan for State-owned banks, which was announced by the Government of Suriname in August of 1999, after careful study by the Central Bank and with the help of the Interamerican Development Bank and the International Monetary Fund. The Merger Committee, along with the support of the Accounting and Management Consulting firm Deloitte Touche Tohmatsu, will play a pivotal role in implementing the reforms that are planned for the country's financial sector.

The Action Plan was generated in response to the rapid change in the international financial marketplace and is intended to create a more efficient and competitive financial infrastructure in Suriname. The Action Plan calls for the introduction of new banking laws and regulations, the reorganization of State-owned banks and the divestiture of the government's ownership stake in the commercial banking sector. As part of the overall reform of the financial sector begun two years ago, the Action Plan includes a new Financial Institutions Act, a new Bank Act, a new Insurance Act and a new Pension Act. Suriname's State-owned banks are currently too small to compete effectively and require significant government subsidies. The implementation of the Action Plan will reduce the burden on government, introduce more efficient management practices, spur competition and attract new investment from both domestic and foreign depositors and investors. The potential benefits of the planned reforms were recently reviewed by Standard and Poor's prior to their assigning a &uot;B-&uot; rating to the Republic of Suriname.

Armand Zunder, a former Minister of Planning and Development of Suriname, has been named Chairman of the Merger Committee and will supervise the consolidation of the country's three state-owned banks, Landouwbank (LBB), VolksCrediet Bank (VCB) and Surinaamse Postspaarbank (SPSB), so as to form a single strong and efficient institution. Other members of the committee include Edgard Lotman, Vice Chairman, Ronald Tjong-A-Hung, Special Supervisor of the LBB, Eugene Noordpool, Special Supervisor of the VCB, T. Ramlakhan, President of the VCB, Rudi Lo-Fo-Wong, President of the SPSB, and Djaienti Levens Hindori, Deputy Director of the LBB.

The total process of consolidation and restructuring will last from two to three years, during which time the Merger Committee will have several key functions. These include managing the process of transition from the three currently State-owned banks to the establishment of a New Bank, efficiently utilizing existing personnel, systems, fixed assets and equipment. The Merger Committee will develop a strategic business plan covering a three year period detailing the activities, products and services of the New Bank based on market needs. The Central Bank and the Ministry of Finance will guarantee the deposits at the banks during the merger process.

&uot;The Merger Committee will work to guarantee the smoothest transition possible during the restructuring of the banking sector as part of a concerted effort to provide a more competitive and efficient financial system for the people of Suriname,&uot; said Chairman Zunder.