UBS should be banned from doing business in PNG after loan deal, PM tells parliament | Papua New Guinea

The Australian arm of UBS need to be banned from performing small business in Papua New Guinea for 10 several years and previous prime minister Peter O’Neill ought to be prosecuted about their roles in a mortgage that resulted in a enormous loss to the place, present key minister James Marape has explained.

A former governing administration led by O’Neill obtained the AUD$1.3bn bank loan from world wide expenditure financial institution UBS in 2014, in order to obtain a 10.1% share curiosity in oil and gasoline exploration firm Oil Lookup Minimal. Even so the rate of Oil Lookup shares before long plunged, with PNG’s shares later marketed at a loss.

Talking to parliament on Wednesday just after the summary of a commission of inquiry into the personal loan, Marape explained the deal had expense the state “in excess of AUD$340m” as perfectly as “lost opportunities” such as the institution of a sovereign prosperity fund and “diversion of revenues” from PNG’s LNG exports undertaking.

“The UBS bank loan had no satisfactory justification or rationale, there was failure to adhere to procedures, apart from a massive fee of AUD$28m,” Marape mentioned. “UBS also overcharged AUD$175m which should really be repaid.”

He also claimed the commission’s remaining report recommended that attorneys engaged by the point out from the Australian branch of Norton Rose Fulbright did not give “proper advice” and that the unit really should be banned from performing company in the region for 5 decades.

Mr O’Neill “knew the submission was intricate and lengthy” but did not give the relaxation of the cupboard “advance see or prospect to debate the submission”, he additional.

Marape, who took more than as primary minister from O’Neill in 2019 and initiated the commission’s inquiry, was serving as finance minister when the offer was struck.

O’Neill stated he “fully recognized the recommendations from the inquiry into the deal” and would “subject himself for additional investigations.”

“I am really pleased to defend myself whether at ICAC [Independent Commission Against Corruption] or at the courts. So I have no problems with that, I am dependable to the people today of Papua New Guinea. I am accountable as a mandated chief.”

“The inquiry into the UBS deal was the most costly of all inquiries at 30 million kina [11 million AUD] and extremely extremely politicized,” he extra.

A UBS spokesperson said the business disagreed with the statements manufactured by Marape in parliament and “strongly disputes assertions that it overcharged PNG”.

The bank had been appointed to act for PNG to receive the mortgage “following a aggressive tender process” and the authorities “received information from a variety of experienced independent Australian and Papua New Guinean authorized and economic advisors throughout the transaction”, the spokesperson reported.

“UBS maintains its dealings with PNG were suitable and clear. The transaction was entered into by PNG under the appropriate legislation and appropriately ratified by PNG Parliament in 2014 in accordance with the Constitution,” the spokesperson said, adding that the bank’s web income from the offer was fewer than AUD$50m.

“UBS presented a specific account of the transaction to the Commission by using two thorough statements (August 2021 and March 2022) and other supporting documentation,” the spokesperson explained.

“UBS believes that its responses, like its critique of the Brattle investigation and conclusions, have been not properly considered by Counsel Helping the Fee.”

A Norton Rose spokesperson declined to remark.