marion williams : financial sector developments in barbados address by dr marion williams, governor of the central bank of barbados, at the opening ceremony of the firstcaribbean international bank business centre, warrens, st. michael, 29 june 2007. * * * thank you, madam master of ceremonies, for your kind words of introduction. mr. charles pink ; other members of the board ; members of management and staff ; specially invited guests ; distinguished ladies and gentlemen. let me first offer my congratulations to firstcaribbean on the construction of this impressive facility at warrens. in so doing, you are confirming your long - term commitment to the development of the barbadian economy. it has now been acknowledged that warrens is the fastest growing urban centre in barbados. by establishing its head office here, firstcaribbean has become part of the growth and the expansion of the area and demonstrates today its confidence that this location has the potential to be a major financial hub. mr. chairman, i am naturally pleased by any activity which seeks to improve the level of financial intermediation in barbados. financial intermediaries agglomerate capital from many small savers and allocate it to eligible users. in so doing, they also transfer, pool and reduce risk, increase liquidity and convey information, thus contributing to an environment for growth. a well - functioning financial system can make an important contribution to the growth of gross domestic product. there is no doubt that over time barbados has enjoyed a very high standard of financial intermediation. the commercial banking sector has led the way in this regard and has so conducted itself that there is tremendous confidence in our banking system. the confidence which the public at large has reposed in the banking sector is exemplified by the continued increase in commercial bank assets. during the two decades ending in 2006, for example, commercial bank assets grew six - fold. firstcaribbean international bank, whose roots in barbados run very deep, has made a major contribution to the growth of the domestic financial sector and, by extension, to the economic well - being of barbados. this has been demonstrated in many tangible ways over the years, including the provision of credit and foreign exchange, the issue of financial instruments and the management of assets. the construction of this facility must be seen as yet another example of the continuing effort by this organisation to be among the leaders in the financial services sector. over the last two decades or so in barbados, it was investment

that provided much of the impetus for the growth in gross domestic product ( gdp ). while consumption expenditure and exports of goods and services kept pace with gdp, the growth rate of investment exceeded that of the gdp by nearly 60 %. over the same period, private building activity ( which includes projects like this one ) grew by 21 % more than gdp. it is projects like this one that would have facilitated the strong performance of the economy in recent years. indeed, the construction sector is still the main driver of the economy, and expanded by 7 % in 2006 and by 5. 4 % in the first quarter of 2007. as is the case in barbados, the buoyancy of the construction sector generated certain spin - offs in other areas. this initiative to rationalise your bank ’ s operational and technical capacity is undoubtedly good for the organisation. it is widely accepted that one good measure of the development of an economy is the level of financial sophistication. as customers ’ income levels rise and they are exposed through the electronic media and travel to more up - market financial services, they will demand a wider range of products and better levels of service delivery. but given the degree to which these modern products depend on accounting, internal control, technology and other services, their provision can be only as efficient as the back - office operations which support them. accordingly, a service - oriented bank must be constantly upgrading these back - office capabilities if it is to meet the public ’ s demand for sophisticated products and services. a financial institution can make its reputation on its ability to deliver those services which are in the full glare of the public, but if the same institution does not allocate adequate resources to its back - office activities it will not keep that reputation for very long. take technology as a case in point. modern commercial banks now use technology to improve the efficiency of distributional channels, utilise outsourcing and improve real - time transactions. as the old adage states, time is money. since the overwhelming majority of banking transactions are time - sensitive, the efficient use of time should be the goal of both the bank and the customer. it is the state of the institution ’ s technology which ultimately affects the bank ’ s ability to make electronic transfers in a timely fashion. i would like to believe that customers can expect to have their accounts credited and debited more speedily as a result of this initiative and that the result will be a more satisfied customer. i am sure that firstcar