Michael Ashcroft may be out of the BTL buyout picture right now but he's at the center of a simmering controversy over $30 million of BTL's money. 7NEWS has obtained a document showing that BTL'a managing director, John Vondras has written to the Governor of the Central Bank Sydney Campbell requesting that $30 million of BTL's money on loan to the Belize Bank, be refunded immediately.
What's BTL doing lending a bank money? Well that's just what Vondras is asking the Central Bank to clear up. Turns out that just before Ashcroft sold Carlisle's 52% holding in BTL in November of 2003, the Ashcroft-controlled board decided to convert a $44 million security that BTL had at the Ashcroft controlled Belize Bank to a $30 million loan, a loan from BTL to the bank at a rate of 9%.
It's more than BTL would have gotten in a cash deposit and enough to earn Ashcroft's bank some nice points when it on-loaned the money in the open market. To be sure, a smooth corporate maneuver, but Vondras is complaining to the Central Bank that it's illegal under the banking and financial institutions act. The money remains locked down until late 2005 or early 2006 and now Vondras says BTL needs it available and he's asking the Central Bank to go into the Belize Bank and convert it back to a fixed deposit. It's a delicate situation, because the Central Bank can hardly afford to take $30 million dollars out of the Belize Bank especially after it sapped up $10 million when it adjusted the reserve requirement a few weeks ago.
What will the Governor do? Well we called him today, but he was not available and did not return our calls. And the same went for Phil Johnson the President of the Belize Bank. And while that question remains, the larger issue is what does BTL want the money for. Typically the $30 million would remain banked the greatest possible yield presently available. That BTL wants it freed up, could mean that Prosser's board wants to use it, for what we don't know. But we do know that the somewhat illiquid Prosser has been moving to buy up the holdings of small local shareholders, and that will require some cash.