Pago Pago, AMERICAN SAMOA — Although it's owned by the government, the Territorial Bank of American Samoa (TBAS) is not run by the government, does not loan any money to the government, and it's a commercial bank, according to TBAS president and chief executive officer, Drew Roberts, who took over the leadership role late last year, from then former boss Philip Ware.

Roberts shared some 'pressing issues' during a Samoa News interview late last week, prior to a Senate committee hearing last Friday and Monday this week with TBAS board chairman, Steven Watson. 

TBAS chief operations officer, Makerita Polu, was present during the interview.

Although TBAS opened its doors October 2016, there are still questions regarding the government’s involvement in a financial institution, and ASG's influence on TBAS operations.

Roberts, a consultant when the Lolo Administration started looking into a bank in 2013, said “one of the pressing issues for us, is a misunderstanding [in the community] that the bank isn’t really a bank. It's kind of a quasi-bank [but] we’re not. We’re a regular... commercial bank,” he explained. “We just happen to be owned by the government. There’s a difference between government owned and government run.”

TBAS is a “commercial bank [is] not government run,” he continued. "There’s no government official that is in management, and we can’t — for example — loan any money back to the government and the government cannot borrow money. They can’t ask us to do things, or request us, or require us, or force us.”

According to Roberts, “We’re completely independent from ASG.”

He noted that a lot of people don’t want to put their money in a government bank “because the government can’t run anything. We kind of agree with that.”

“The government is not in the business to run a business. The government is in business to run the government,” he said. “And we’re [TBAS] in business to run a business, we’re in business to run a bank. So the management and staff of the bank are bankers. We’re not government employees, we don’t get paid by the government, we get paid by the bank.”

Roberts said there’s a wall between TBAS and ASG — "a very sturdy high wall.”

He explained, ASG “can’t influence us. They can’t fire us, they can’t give us raises."

He pointed out that TBAS’ “relationship with the Federal Reserve Bank, keeps us alive, and requires us not to have government influence.”

As Samoa News reported early last year, based on an interview with former TBAS boss Philip Ware, the TBAS management and board had given the Federal Reserve guarantee that the government would not be involved in TBAS operations, and that guarantee resulted in the bank getting a routing number, which allows TBAS to expand its business portfolio and set up a master account with the Federal Reserve.

Perhaps one of the reasons there is still a misunderstanding in the community over TBAS and its operation, is the fact that it's not insured by the Federal Deposit Insurance Corporation (FDIC).

“Perhaps,” Roberts responded. “The issue with FDIC insurance, only comes up because we’re the only commercial bank in the United States, that doesn’t have FDIC insurance.”

“There’s one other bank, very profitable, good bank in North Dakota that doesn't have FDIC insurance. But they’re not a commercial bank,” he said. "We’re here for the people of American Samoa”.

Samoa News asked Roberts to elaborate on the actual role the bank in North Dakota — a state-charter bank — played in setting up TBAS.

Roberts said there might have been some misunderstanding on that issue as well. He said the bank in North Dakota “was a model on how we had to establish a bank, not how we have to run a bank. It was just a model to establish, which means change statutes, which we had to do; reliance of a board, requiring government to deposit their operating accounts with us... that we had to do. No other bank has that. We’re the only bank that does.”

Another issue has to do with TBAS being "a real bank”.

“They don’t understand that we’re a real bank — a commercial bank,” he said, and cited for example, early last week, he was questioned on whether TBAS offers several types of banking services.

For example, a TBAS customer can transfer funds from a TBAS account to another bank   through ACH; can receive direct deposits. The bank has and continues to provide personal and business loans; it can do wire transfers and so forth, he said, adding that specific details are of services and limitations on such transactions are available at TBAS.

(ACH stands for Automated Clearing House, which is a network that coordinates electronic payments and automated money transfers. With the routing number, TBAS is able to join this network.)

“We are a bank. We do everything a normal bank does. And that’s kind of a hard thing to get through to people because it took a long time to get a routing number,” he concluded. (Samoa News will report in future editions on other issues shared by Roberts and Polu.)