In its most recent report on access to financial services within Lodamun, the Federal Reserve Bank concluded that compared to the other states and other territories throughout the region, the Native Territories with its population of around 1 million persons, remains the most underbanked/underserved area in Lodamun and one of the most on the Seleyan continent. The bombastic report, which has been the subject of a furious debate within the Territorial Assembly as representatives railed against the nation’s major financial institutions for “leaving millions of persons behind,” was compiled by the Federal Reserve Bank as part of a new series aimed at addressing a gap in macro as well as microeconomic data related to the Native Territories. According to the report, 89% of the population of the NT remains unbanked with the reasons for this statistic being varied. It notes that the vast majority of the “unbanked” in NT either do not trust Lodamun’s major financial institutions or have to some degree faced discrimination at the hands of said financial institutions, which ultimately dissuade them from being “banked” in the first place. Although not explicitly named in the report, it could be deduced that the financial institutions alluded to in the report are the Bank of Newchester, Flintwood Nash and Hewlett & Lynch. Yet, against this backdrop, the report also points to the undeniable fact that the scale of “unbankability” in the NT could be related to the broader macroeconomic context as subpar earnings among individuals ultimately lend themselves to hesitation toward saving and maintaining a bank account and towards simply living on said earnings to “just get by.”
A legislative representative for Paasat Community, Satanta Cowgill notes that there was a considerable amount of people within the NT “just getting by” who were working from paycheck to paycheck and thus the idea of even maintaining a bank account did not come as a thought to them. “Many already come into this situation with an inherent suspicion of banks and thus prefer to take their earnings in cash as they believe they’d have greater freedom to spend their money,” Representative Cowgill explained. Interestingly, Rep. Cowgill notes that the nature of “unbankedness” within the NT could not be placed solely at the feet of subpar earnings, a mistrust of banks or even discrimination, but instead could be attributed to a suite of challenges which he says have been raised within the Territorial Assembly in numerous occasions. “It would be disingenuous for anyone to suggest that things are they way they are now solely because of discrimination, mistrust of banks or low earnings. The root causes namely: the frequency of banks, ease of doing business and a system which seems largely hostile to the type of banking required in the NT, have been raised ad nusseum by numerous representatives in the Territorial Assembly and in our meetings with congressional leaders and members of the Federal Government,” Rep Cowgill explained. Governor of the Native Territories, Nosh Thomas who has been a long-term advocate for a greater presence among Lodamese banks in the NT, stated that previous Governors have attempted to prompt the “big banks” to work with them on improving this situation but to no avail.
With technical assistance from the Bureau of Native Affairs, territorial legislatures, business leaders and members of the territorial government have drafted a framework, which when fully implemented would create what is being considered the first publicly-owned commercial bank in Lodamun. “
First Territorial Bank”, as is being proposed, would operate exclusively in the Native Territories and will provide financial services ranging from loans/borrowing, to wealth management to citizens of the Native Territories only. At a brief press conference alongside Director of the BNA, Governor Thomas stated that the territorial legislature had envisioned that FTB would fall outside of the Banking and Financial Services Act, which regulates banks and other financial services entities in Lodamun. He noted that in pursuit of greater autonomy from the Lodamese banks, legislatures structured the FTB Act to follow the guidelines as set by the Banking and Financial Services Act instead. Officials from the Department of the Treasury confirmed that although territorial legislature also placed an obligation on the Territorial Government to guarantee future deposits, it would nonetheless be considered a defacto member of the Credit Reconstruction Corporation, and would be subject to both the CRC’s guidelines in strenuous economic/financial circumstances. “Although we recognise this as an earnest attempt to develop and maintain one’s autonomy from the big four, it [FTB] will still be considered a de facto member of the CRC and will thus be guided by its rules and guidelines, especially during periods of financial uncertainty,” Associate Secretary for Financial Services Ethan Bradley explained.
One of the key regulations coming out of the debates on the FTB Act is that the bank would have to establish branches in each of the nations of the NT and therefore has a statutory obligation to reduce the state of unbankedness in the NT from 89% to 40% in the coming decade. Governor Thomas is reportedly in deep consultations with independent assembly members on a broad agreement as to who would be appointed as the bank’s Chairman. Although such an appointment is decided by the Territorial Administrator, the FTB Act allows for the Territorial Assembly to recommend that the Territorial Administrator appoint their nominee. Some of the names under consideration by the assembly include veteran banker and former Regional Financial Planning Manager at PCH Carville Arthur Harrison, former financial advisor to the Governor Yahto Kane and businessman Machk Wilson. Although not the bank’s CEO, the Chairman would nonetheless provide strategic direction for the bank.