NASSAU, BAHAMAS — The Central Bank has revealed that it has been hit with a legal claim of over $3 million for ‘wrongful termination’ of a contract connected to the abrupt decision to abandon its plans to construct its new Royal Victoria Gardens headquarters.
The Central Bank’s recently released 2023 annual report noted: “In March 2023, the Board of Directors approved the termination of the new premises project and the transfer of the property ownership back to the government. As a result, the bank has recognized an impairment loss associated with this project, totaling $243,068 (2022: $8,919,6070) for the year. The bank will explore alternative arrangements to meet its long-term accommodations.”
It further noted: “During the year, a vendor filed a legal claim in excess of $3,000,000 against the bank for wrongful termination of the contract. The bank’s external legal counsel is in the process of reviewing the validity of the claim.” The vendor was not identified in the report.
The decision to cancel the project, which resulted in the bank having to suffer a nearly $9 million write-off after six years of work had gone into preparing for the project, has received strong criticism and calls for further explanation from the Opposition.
The Central Bank hosted a highly publicized competition in 2018 to determine the building design, with the project touted as an integral part of efforts to revitalize Nassau. The project’s site preparation and demolition phase began in 2020 and the architectural designs were completed.
Economic Affairs Minister Michael Halkitis previously stated that the Davis administration canceled the new multi-million dollar Central Bank headquarters project because building it would not look good following the COVID-19 pandemic. The Opposition rejected this explanation, noting that the Central Bank was utilizing its own funding.
In its 2023 annual report, the regulator also revealed that it is preparing to break ground on another project that has been in the works for some time. The Central Bank noted that it anticipates breaking ground for its Cash and Data Centre project by June 30 and completing it within 24 months. The property for that project was purchased back in 2022.
Loading ...
