A month ago when Home Bancshares acquired Stonegate Bank of Florida in a $778.4 million deal, the Conway-based bank picked up an unknown asset in Cuba.
Johnny Allison, chairman of the board for Home Bancshares, said at the time that Stonegate’s presence in Cuba “could really be big.” Stonegate is the only U.S. bank with the ability to conduct credit transactions in Cuba.
Allison previously said that he didn’t know what to value the Cuban connection from Stonegate because he didn’t understand it. “We’ll be going next week to Cuba and meeting the minister of finance, and having a little rum and smoking some cigars, and drinking some coffee. Maybe by the time I get back, I can give you a report on how Cuba was and what we think we can do with that,” Allison said in late March.
Fast forward a month and Allison is back and reporting.
The bank entrepreneur tells Talk Business & Politics that he met with the equivalent of the U.S. Federal Reserve Bank in Cuba and that if U.S. law and policy changes, he sees the potential for worthwhile opportunities in the tiny communist nation in the Caribbean.
“We were there about two days. We flew into the airport, a big nice airport, and then took a ’55 Chevrolet, if you can believe that. It was my limo into Havana,” Allison said. “The Cuban people are wonderful. They love Americans. There’s no crime there. You feel free walking around, but it’s poor. You get out in the outer areas and you see some poor people. You still see wagons and horses, but primarily there’s automobiles.”
Allison said he had about a three-hour lunch with several Cuban finance officials who expressed their excitement about opportunities to do business in the states. He said they were familiar with Arkansas agriculture and two Arkansas governors, Mike Beebe and Asa Hutchinson.
“They know Arkansas and they know Arkansas rice and they know Arkansas chickens,” he said.
“They love Governor Beebe and they love Governor Hutchinson by the way, both governors. They’re thrilled about Arkansas and that their new connection, banking connection, is Arkansas and they think that’s all come together for a reason.
“I told them that Governor Beebe serves on my board and also serves on Tyson’s board, so we have a good in and they remembered him coming and they remembered Governor Hutchinson coming and were very complimentary of the people of Arkansas.”
Presently, Allison explained Stonegate has the ability to conduct business for Carnival Cruise Line, which refuels in Cuba, by wiring money for the fuel to Panama which in turn sends it directly to Cuba.
Legislation championed by Arkansas Sen. John Boozman and Rep. Rick Crawford would loosen that difficult credit restriction and could allow for direct payments to Cuba. That could open up numerous larger trade opportunities for the state’s poultry and rice markets.
He isn’t sure if he’ll be the one doing any arm-twisting to make that happen, but Allison predicts the day will come and he’s already got a toe-hold in the market.
Allison also observed a lot of entrepreneurial activity in the making during his Cuban visit.
“In the past, everybody worked for the government and it was a socialized society, but as the ambassadors there said, it looks like the genie is out of the bottle,” he said. “I had dinner with a restaurant entrepreneur, he owns five restaurants and has been very successful.”
On the flip side, Allison saw plenty to depress him, which is why he thinks opportunities for Arkansas are forthcoming.
“We went into the grocery store and if you wanted beer or wine or water, you could get all you wanted. But you think about going to Harp’s Food or Kroger or one of those and how many packaged meats they have in the store – hundreds and hundreds and hundreds – and there weren’t 25 [packages] in the whole grocery store. They need that support, which Arkansas can help them provide.”