Mr. Minister [Chris Sinckler], as individuals own less than 10% of the BNB shares, you are negotiating for all of us on this occasion. Please do not sellout the Barbadians that have small shareholdings. There is no reason why you should not seek the best price for the Government and people of Barbados. At a minimum, seek competitive bids from other entities. We look forward to your support, in what is your first major action that will impact us. Thanking you in advance – A. Freeman
The resignation of Tony Hoyos from the Board of Directors of the Barbados National Bank (BNB) should should concern Barbadians. Hoyos’ letter of resignation was posted on Peter Boyce’s Facebook Page earlier today.
A full page statement was posted in the local press today by Republic Bank (BNB’s parent company) signalling it will be making an offer to buyout the remaining shareholders in BNB. An article also appeared in the Trinidad press yesterday. Currently Republic Bank Limited (RBL) owns 65.13% of BNB, the government of Barbados 28% and individuals 7% round out the ownership.
Hoyos makes a few assertions in his letter of resignation which should make Barbadians take interest. When majority interest in BNB was sold to RBL in 2003 many Barbadians cried we were not given enough time to buy into the deal. Many years later Barbadians still become emotional at the thought of our national bank under Trinidadian ownership. The Late Prime Minister David Thompson echoed the feelings of Barbadians by making the hollow statement in 2008 that Barbados should look to to repurchase BNB from RBL.
Barbadians have a chance to make their voices heard second time around. If RBL wants to buyout the remaining 35% shares in BNB they should be made to pay a premium. No doubt the RBL offer of $5.57 is influenced by the fact the government of Barbados is currently labouring under a serious cashflow-debt burden problem. It would be a shame if Barbadians allowed RBL to grab our family treasure at a steal, again. All Barbadians need to get involved in this discussion, the 28% shares owned by the government of Barbados means we the PEOPLE are owners of a significant stake of the BNB pie. By all means sell your minority interest but it must be at a premium.
Additional to fetching a premium price for the remaining shares the use of the name Barbados in the name of the bank should be withdrawn. BNB has been able to generate healthy profits linked to the goodwill and sentiment associated with the use of the name ‘Barbados National Bank’. While there is a vested interest in the current arrangement for minority shareholders, if RBL is able to acquire 100% interest in BNB, the accommodation of the use of ‘Barbados’ should cease when the deal is consummated.
BU commends Tony Hoyos for the principled position he has taken in this matter based on the information in the public domain..
By Geralyn Edward | Mon, October 25, 2010 – 12:06 AM
Republic Bank Limited is unlikely to offer more than the current market price of approximately $5.57 per share to shareholders of Barbados National Bank (BNB).
That’s the word from David Dulal Whiteway, managing director of Republic Bank of Trinidad and Tobago, the parent company of BNB which is trying to get 100 per cent control of the local bank, once described as the jewel in the Republic Bank crown.
Whiteway said BNB’s PE ratio (its share price relative to the annual net profit earned by the company per share) was even higher than its parent company’s, thus the current market price was more than a fair representation of BNB’s true share value.
He told the DAILY NATION that Republic Bank would inject about US$95 million into the Barbados economy as a result of the proposed buyout.
Republic Bank’s general counsel Jacqueline Quamina said after receiving the green light from local regulatory officials, the Trinidadians want to wrap up the deal by yearend.
Whiteway and managing director Robert Le Hunte said BNB wanted Barbadians to view he Republic Bank move as another vote of confidence in the local economy.
Le Hunte added: “Over the past two years we have invested no less than $30 million in new computer systems, a new Broad Street, Bridgetown branch and our property at Limegrove in St James.
“We have used the last two years of moderate growth to retool the organisation and preparing it for the future. That is definitely a vote of confidence in the future of the Barbados economy.”
According to the BNB boss, Republic Bank had put a larger percentage of its investment capital in Barbados over the last five years, than it had in other countries where the Trinidadians had acquired financial institutions such as Guyana and Grenada.
The Republic Bank is hoping local investors will use some of the cash from the buyout to invest in the parent company.
Republic already owns 65.13 per cent of BNB’s 96 million shares. The Government of Barbados owns 17 million of the outstanding shares, 9.6 million are owned by the National Insurance Board and a significant number is owned by the Insurance Corporation of Barbados Limited.
The point not made in the blog – it is not cool to convert assets to cash in order to pay bills.
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Capone
Now that we know the share price, at a valuation prepared by Republic, we now know what the Governement needs to outlay in order to push a counter offer to buy Them out.
BNB is a successful business making in excess of 40 million a year. If it was me, I would seek short term financing, in order to facilitate the purchase from them ( this should be feasible once again based on the strength of the BS, Profits and cash flow).
There is no need to sell, we need to counter offer and use the strengh of the Company for external finance until we can close the deal then BNB can take over, being 100% Barbados Gov owned, the loan portfolio.
As a Business Man having had personal dealings with all banks in Barbados, without the BNB and the Credit Unions we are screwed.
There are ways to finance this. Whenever you are looking to buy a successful business, especially one such as the BNB, it is workable.
The Government should look at all it’s options first. I have used this technique in buying other successful business and it has been facilitated based on the strength of the asset and cash flow available being aquired.
If Republic are not happy based on the counter offer at the share price they established then we go to Court.
Since Republic Bank already has majority control over the operations of the Barbados National Bank, it would be interesting to analyse what further advantages 100% ownership will confer. At the least, 100% ownership would seem to require a name change to, say, the Barbados National Bank of Trinidad and Tobago! More seriously though, we should look beyond the corporate billiard ball to discover who are the beneficial owners of RBL, since it is they who ultimately control decision-making in BNB.
One should not forget, however, that it is possible to have ownership of an entity without having control, as well as control without ownership. What is important here is the determination of the role the governmental authorities will attempt to play in the future decisions and operations of the BNB.
One final point. Should we not take a look at the extent of Trinidadian ownership of Barbadian private sector entities in general, or would that stir up a jingoistic hornet’s nest?
It was just last week there was an interesting discussion on air about the paucity of a significant Bajan enterprise space and our inability as a consequence to create domestic capital formation.
If only as you alluded we can get an informed discussion on this and related matters without those liberals on the sideline ever so quick to label those who would seek to place Barbados first.
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Carlos
Why is it that the RBL must have 100% ownership? At present they already have control , this further push to acquire 100% could mean the delisting of the BNB and it could become another privately held Trinidadian owned Barbadian entity. This would be most embarassing as the Barbados financial decision making destiny will be controlled by Port of Spain. Why cant Barbadians continue to share in this pie that we created?
This reminds me of the marauding pirates in our history books.
THE BARBADOS GOVERNMENT MUST RETHINK THIS DECISION AND SELL IF IT MUST TO CREDIT UNIONS,STAFF OF THE BNB AND PRIVATE COMPANIES AND INDIVIDUALS.
@Carlos… “Why is it that the RBL must have 100% ownership? At present they already have control , this further push to acquire 100% could mean the delisting of the BNB and it could become another privately held Trinidadian owned Barbadian entity.
Very, *VERY*, good!
The only answer which makes sense for 100% ownership is delisting.
Non-public companies don’t need to report to the general public. (Or, even for that matter, the Government…)
Selling to local concerns will likely not generate hard currency.
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anthony
while i agree with chris about the public they still must submit audited financial report for their corporate tax filing to government but even then they can be lot of leeway given as was the case clico submitting of financial reports in recent years.
Are you comparing the regulatory system which exist for banks in Barbados to how other non financial companies are regulated?
Have we not had an exemplary banking system the envy of many?
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anthony
No i am not. i just saying there had been leeway for finical report not that any would be given for this case though there always a first for everything. they still have to do report do audited finical report for both the government and central bank.
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Anonlegal
George Reid said:
“More seriously though, we should look beyond the corporate billiard ball to discover who are the beneficial owners of RBL, since it is they who ultimately control decision-making in BNB”
CL financial ultimately/indirectly owns a little more than 50% of the shares in RBL.
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Anonlegal
Chris said:
“The only answer which makes sense for 100% ownership is delisting.”
Good point Chris. I agree. There would be no point in being a publicly listed company if there is only one shareholder.
With billions worth of deals in the balance, the authenticity of one of them, a deed which purports to give huge powers to Lawrence Duprey and L Andre Monteil under protection of an indemnity clause, is now under a cloud of suspicion after one of the purported signatories has come forward describing the document as “suspect”.
Peter Salvary, a one-time key player at CL Financial and a former director of Clico this week said that while his signature appears on a May 2005 power of attorney document which gave Duprey and Monteil wide-ranging powers to handle Clico assets, he has no recollection of the document. What is more, although he is listed as a signatory of the document in his capacity as a Clico director, Salvary says he was not, at the time of the signing of the document, a director at Clico. He says he had resigned the month before.
“I consider the instrument to be quite suspect,” Salvary this week told Sunday Newsday in a statement sent to this newspaper after an interview. Further checks also reveal that the document appeared to also come after a series of manoeuvres which saw the former board of Clico effectively purged of all but one in what was billed as a restructuring exercise.
Sunday Newsday last week exclusively reported the existence of the deed, dated April 23, 2005, but purportedly signed on May 5, 2005, by Salvary and Lawrence Duprey’s cousin Roger Duprey.
The document purports to give Lawrence Duprey, Andre Monteil and corporate secretary Gita Sakal power to do a series of acts in relation to Clico assets, including the handling of and collection of monies in relation to the shares of certain affiliated companies including the Home Mortgage Bank, Angostura Holdings Limited and Methanol Holdings Limited. The document also indemnifies the parties from lawsuit, meaning if actions were ever to be brought against Duprey, Monteil or Sakal in the exercise of the powers assigned, Clico, and not the trio, would have to foot the bill and pay any damages.
Lawyers have said the document has implications for pending civil suits, some of which are envisioned under draft legislation prepared by the Office of Attorney General Anand Ramlogan.
But now the deed has been brought under question. The document, obtained from the public records system of the Ministry of Legal Affairs, is eight pages long. On its face, it is dated April 23, 2005 (a Saturday) but then, pages five, seven and eight indicate that the document was signed by Salvary and Roger Duprey on May 5, 2005.
The bottom of page five reads, “in witness whereof the common seal of the company was hereunto affixed the 5th day of May Two Thousand and Five.” The next page, page six, is a signature page and appears separate and apart from the other terms and conditions of the document that precedes.
Page six begins, “the common seal of Colonial Life Insurance Company (Trinidad) Limited was hereunto affixed by Peter Salvary and Roger Duprey two of its directors in conformity with the articles of continuance and the bye-laws of the company and signed by them in the presence of Carene Bissoo-Balkaran, executive secretary.”
There are what appear to be the signatures of Salvary, Roger Duprey and Bissoo-Balkaran on the page. Salvary this week said the signature on the page is his, but he has no recollection of ever seeing the document.
In a statement emailed to this paper after an interview last week, Salvary, who supposedly signed, said, “I do not recall having ever seen such a document but I cannot refute my signature.”
The former Clico director added, “the document was purported to be signed by two persons. According to law no individual director is empowered to give such an indemnity. Such authority is vested only in the board of directors and such an instrument must be signed by all of the directors in order for it to be valid.”
“In the case of a resolution by the shareholders it can only be done at a meeting of shareholders called for that purpose. As indicated to you I resigned from the board of directors on April 30, 2005 and I do not recall taking part in any discussion of such a nature prior to my resignation,” Salvary said.
While most documents in the ministry’s public records system are computer scans, the image quality of the deed on file in the public records system appears to be of a relatively poorer quality.
On page one, what appears to be a stamp affixed by Commissioner of Affidavits Yacub Mohammed, is dated May 10, 2005. On page eight, the standard witness recitation states that the signing of the document was witnessed by attorney Faarees Fayaz Hosein and Bissoo-Balkaran on May 5, 2005 at Clico’s head office of 29 St Vincent Street, Port-of-Spain.
The document is on file alongside an unsigned certificate of registration which states that the document “is registered in the office of the Registrar General, Port-of-Spain at 9.02am on the 13th of May 2005 as document No DE200501218564D001.”
Further checks in the computer system of the Registrar General reveal that the document was received on May 13, 2005 at 9.02am and “verified” on May 24, 2005 at 12.13pm. The document is listed as “active” and “verified” in the system. According to Companies Registry documents, Salvary was not a director on May 5, 2005, the date on which the deed was purportedly signed.
And while the deed purports to be dated April 23, 2005, this was a mere two days before Salvary and the then board of Clico were asked to resign, ostensibly as part of a CL Financial Group restructuring which, after the dust settled, left one party untouched.
An email from Gita Sakal, then Clico corporate secretary, dated Monday April 25, 2005, was sent to the then Clico directors asking all to tender their resignations in line with the restructuring. At the time the directors were: chairman Lawrence Duprey, Kerston Coombs, Michael Anthony Fifi, Andre Monteil, John Bannerman Christopher Martin, Peter Salvary and Neil Malachi Jones.
“Dear Directors,” a printed copy of the email, obtained by Sunday Newsday, reads. “You will recall that at the last meeting of the directors of CL Financial, the sole shareholder of Clico, the chairman alluded to increasing pressures from regulators for organisations to observe good corporate governance practices and the need to separate the board of CLF and Clico.”
CLICO from Page 3A
“We are asking that all existing Clico directors submit their resignation from the board of directors to the company secretary Ms Sakal. All resignations should be dated 30 April, 2005,” Sakal said in the email.
Sakal made it clear that, “the new board will comprise the following persons: Claudius Dacon, Ian Garcia, Gener Dzyaik, Karen Gardier, Heydon Charles and Nicole Patrick”. Sakal said there would be a meeting of Clico directors on May 2, 2005, to install the new directors. The email ends, “sincerely, Gita.”
Salvary complied with the request – which he said came from former chairman Lawrence Duprey – and by letter dated April 30, 2005, five days before the purported signing of the deed, resigned.
“As requested by the chairman, I hereby tender my resignation as a member of the board of directors of CL Financial,” he wrote, apparently under the understanding that he was resigning from the CL Financial group, including Clico. (CL Financial Limited is the parent company of Clico.)
In an indication that even high-ranking board members themselves apparently did not observe legal distinctions between the legally separate entities CL Financial Limited and Clico, Salvary this week insisted that he effected resignation from Clico in the letter. However, the subject of his letter read, “resignation from the board of CL Financial Limited.”
Checks by Sunday Newsday, however, show that on the date of the planned Clico directors meeting of May 2, 2005, a decision was taken to remove Salvary from the list of directors on same date.
A notice dated May 2, 2005, filed in the Companies Registry under the Companies Act, informed that Salvary had ceased to be a director of Clico, as well as the other directors. Salvary this week said he did not attend further board meetings.
But that is not the end. The same notice, informing the Companies Registry of the names of the directors who had resigned, was apparently amended at the last minute.
The document, dated May 2, 2005, originally listed the directors who ceased to hold office as: Lawrence Duprey, Fifi, Roger Duprey, Kerston Coombs, Monteil, Salvary, Jones and Martin.
It was signed on May 6, 2005 by Sakal, an attorney, and was in line with the statements in her email of April 25, 2005, to all of those directors.
But on May 9, 2005, the date on which the document was filed, Duprey’s name was scratched out. Further, the notice of the new directors was amended, with Lawrence Duprey’s name inserted, in the face of what had been said in Sakal’s email. The document had originally been signed by Sakal on May 5, 2005.
The changes were authorised by a letter dated May 9, 2005, signed by new director Claudius Dacon, certifying that a legal assistant filing the document was authorised to make the changes. Dacon was named as one of the new directors in another notice, also filed on May 9, 2005, dated May 2, 2005 and signed by Sakal on May 6, 2005.
The cause of these amendments and whether they reflected the correction of an error; a purported directive by the new board of directors in relation to a decision by the old board; or a deliberate shift in the policy of the restructuring exercise – as expressed in Sakal’s email – is unclear.
The restructuring exercise aimed at getting “external” or independent directors at Clico, but the new directors as at May, 2005, were largely drawn from within the CL Financial family. Two other directors, who did not appear to have CLF ties, would only be named as directors four months later in September 2005.
Duprey and Monteil did not return calls and messages from this newspaper. Sakal could not be reached at her mobile phone number. The Government this month announced a one-man Commission of Inquiry into Clico.
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Sargeant
David
Could you reproduce the notice about this offer that was published in the local Press?
I was wondering about the reason(s) for purchasing the remaining shares since they already own 65% of the entity and I can only speculate that the minority shareholder i.e. the B’dos Govt has the ability to nominate directors who will protect their interests and by extension the interest of Bajans but the Trinis don’t want Bajans poking their noses in T & T business (and it does belong to Trinidad that horse has long escaped the stable).
The other issue that concerns me is the price being offered and I agree with Hoyos on this matter. The market price should be an opening offer not a final offer as even in these depressed times most companies who want to buy out minority shareholders offer a premium to “sweeten de pot” but the Barbados Gov’t may be cash strapped ( I just read that Standard & Poors has lowered its rating) and may have it no alternative. If the Gov’t does accept the other minority shareholders will have no choice but to fold otherwise they will be up the proverbial creek.
It a shame that a Barbadian institution arising from the Barbados Savings Bank has become a branch plant of a Trinidadian concern and the directives come from Port of Spain.
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BAFBFP
Yardbroom | October 25, 2010 at 2:52 AM |
A wonderful opportunity for Minister Chris Sinckler to make his “stamp” and inform Barbadians what he is all about.”
Stinkler already did when Stinkler left NGO opposing messy EPA and spin on coin when Stinkler become Minister in Government no? Stinkler say that when in NGO Stinkler not have all the facts … no, no… Stinkler spineless opportunist no? He not prove me wrong… though man from East getting recall, no?
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BAFBFP
By and way, how do Trinidadian family pronounce names..? Many name on document make tongue do tango no?
Here is the newspaper ad 1,2. Why do you want to read the crap of a reason RBL is spooning intelligent Barbados for wanting to wholly own the BNB 100%?
To streamline internal processes indeed!
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Sargeant
David
I did see the “crap” and I was going to comment on it but I didn’t want to quote from memory. Maybe you are right, I’ll just save my breath can you imagine that they paid someone to come up with the “streamline internal process”? Time was when Trinis thought Bajans were smart and they would provide more plausible reasons but I guess times have changed
Is it not ironic that after Barbadians were feed the ‘rhetoric’ by the government that we should explore buying back the BNB from RBL we would meekly surrender our 28%?
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Bush Tea
@ David
There must be a good reason why we would no sell them all 100% and then proceed to launch the new National Savings Bank of Bridgetown?
Obviously this would be 100% Bajan owned, and Government, Credit Unions etc would transfer their patronage there. (tek wanna meat outa we rice…)
What is that good reason…?
Problem is who would run the NSBB? Thanks to the failings of the Cave Hill gang, we would probably need to hire a Trinidadian manager anyway…
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anthony
maybe it just a grand pr campaign for all us to follow. with no planing of it being able to get done in reality. one thing is certain though rbl has turn bnb into a very profitable entity far better than goverment ever did.
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Hants
I think Bajans should sell the 28% on condition that the name is changed to Republic Bank.
When the economy starts to recover, a new Barbados National Bank can be created.
A Barbados NATIONAL Bank should always be majority owned by Barbadians. Pride and Industry???
Not sure you are aware the government at the time of the sale stripped out the non performing sugar loans. Also BNB was making good profit under Greenidge who was recruited from overseas to do the job.
“Are you comparing the regulatory system which exist for banks in Barbados to how other non financial companies are regulated?
Have we not had an exemplary banking system the envy of many?”
@David | October 25, 2010 at 11:48 PM | @anthony
“Not sure you are aware the government at the time of the sale stripped out the non performing sugar loans. Also BNB was making good profit under Greenidge who was recruited from overseas to do the job.”
A number of interesting comments have been made in the intervening period between the two postings that I have quoted. As a person who had some involvement in the creation of the BNB, I can say that the most recent developments have taken me by surprise. I believe that most of my associates in the BNB-creating enterprise had reasonably clear, but, perhaps, modest objectives for the establishment of an “indigenous” financial institution. However, between 1978 and 1994 the BNB endured a difficult existence, and at one time (along with another similar institution) posed serious risks to financial system stability in Barbados. Freeing the portfolio of the BNB from the non-performing sugar industry loans and the appointment of Mr. Greenidge [a Barbadian who had his tutelage with the Bank of Nova Scotia, in Barbados] were important remedial actions. The privatisation of the BNB and the sale of the majority of its assets to the RBL were further steps on the road to making it a credible financial institution.
The ownership structure of the RBL could not have been unknown to our governmental authorities when they approved the purchase of the BNB’s assets. However, the questions that must be answered, now, are why was there no significant interest in the acquision of those assets by Barbadian entities, at the time that they were on offer, and what action did the authorities take to stimulate such interest.
Talk is cheap! But talking seems to be what we are best at. It is one thing to have a dream (with or without moisture). It is quite another to live it. The downside of FDI (and if the purchase of the BNB was not FDI, what the hell was it?) is the loss of ownership and control over local assets. Policy-makers may wish to suggest that assets sold to foreigners may be “reacquisitioned”, as is indicated by the statements made about “repatriating” the BNB. But that is easier said than done! Indeed, when we have “developed” Barbados through the sale of all our tangible and intangible assets, what will we do for an encore?
The point that I am making is that it is irrelevant to be focusing at this time of the price that RBL should be made to pay for the BNB shares that it wishes to acquire. It has been said that “beggars can’t be choosers”, and in the context of our national economic woes, we are all beggars! What should concern us, is that given the importance of financial system stability, and given too, that significant threats exist to financial system stability in Trinidad and Tobago, what will it mean for our financial system in Barbados, if it becomes more inextricably linked to that of Trinidad and Tobago.
I have said before, that these problems cannot be resolved by purely domestic actions. THE TIME FOR REGIONAL SOLUTIONS IS NOW!!
FDI FDI FDI, and what government official do with FDI? Import cover, import cover, import cover, travel, travel, travel, spen’, spen’, spen’…!
By an’ way, when bank show big profit, know that bajan consumer be big exploited …
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Carlos
I have some difficulty with the contribution of @Doc R. Since he was involved in the BNB before RBL he should be aware of the ownership structure which was complex (four types of shares) and only served to frustrate the local investors. The credit unions were willing to participate in the purchase but were snubbed by the then Government. Check Stephen Lashley who spoke at length on the matter in the house of assembly recently. When it was announced that RBL were to involved as a “strategic partner” Government immediately went to parliament and changed the share structure of the BNB to accommodate RBL. This was not done for BARBADIANS when we were asked to buy. We were being told to invest but without any say , the offer was insulting. Very few people remember this .Why is that?????
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George Reid, PhD
@Carlos | October 26, 2010 at 11:58 AM |
“I have some difficulty with the contribution of @Doc R. Since he was involved in the BNB before RBL he should be aware of the ownership structure which was complex (four types of shares) and only served to frustrate the local investors. The credit unions were willing to participate in the purchase but were snubbed by the then Government. Check Stephen Lashley who spoke at length on the matter in the house of assembly recently. When it was announced that RBL were to involved as a “strategic partner” Government immediately went to parliament and changed the share structure of the BNB to accommodate RBL. This was not done for BARBADIANS when we were asked to buy. We were being told to invest but without any say , the offer was insulting. Very few people remember this .Why is that?????”
Carlos, my friend, this discussion is not about me, or whatever role I may have played in the disposition of the BNB. Are you suggesting, however, that I am now questioning decisions in the determination of whose content I MAY have played some bit part?
If so, cannot I request a pardon for any errors that I committed in that incarnation?
The record will show that I retired from the public service in August 1996 (since I went on pre-retirement leave, my last effective working day was in April of that year, and I left Barbados before the end of June). One of my last activities was the negotiation of the Investment Sector Reform Program (ISRP- pronounced “eye syrup”) loan with the IDB. Admittedly, the discussions recorded in the GOB’s letter regarding its, then, future policy actions contemplated the eventual privatisation of the BNB. However, I had no involvement in the detailed construction of the privitisation programme, nor in the manner of its execution.
An even if I had been so involved, I would still feel that it is in order for me to draw the attention of the Barbadian public to the consequences of what has been done in its name!
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Carlos
D’ont get me wrong Dr. Reid there is nothing personal. I appreciate your discourse but i just wanted to set the record straight. But now we are in this position what do you recommend to resolve this issue in favour of all Barbadians?Is it too late? we have passed the blame stage.
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Young Bajan
Think some might have missed the point as to where majority of your pensions reside. HINT: NIS. Think about what that may mean.
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Doatish
Thanks Tony for being Frank. I holin’ on to me shares.
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Really
WIIIFM. Whats in it for Tony Hoyos? Whenever I see Hoyos I remember that female employee who testified he ordered that meal allowances paid to her must be spent at his restaurant. Anyone remember government agency at which he was a Board member? I simply dont trust that fellow.
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Justin Robinson
Is there something in BNB’s bye laws that would require Republic Bank to own 100% of the shares to be able to make a decision to delist.
When this issue re-emerged in 2008 I wrote an article in the newspaper arguing that barbadian investors should try to acquire majority shares in BNB. In lieu of such a move I have difficulty seeing the advantage of the government continuing to hold on to 17%.
I think some pertinent questions would be:
Are there other buyers willing to acquire that large a quantity of shares at a better price than the current offer?
Given the way our stock market works, is the share price likely to get to $7 per share in the near to medium term?
Should/can investors who want cash for their shares wait for the share price to rise or a better offer to come along? I think there are some serious question marks over how long an investor would have to wait for either event to occur.
Given that they already own 65% of the shares why would Republic Bank pay a premium to axquire more.
Effective control of BNB was ceded to Republic Bank when they were sold 50+% of the shares. I believe that the best approach would be for barbadian capital should mobilise to acquire a majority ownership stake. In lieu of that I fail to see the advantage of govt holding on to 17%. For investors who want cash for their shares I am not sure a better offer is on the horizon. For those with a longer term perspective, by all means hang on to your shares.
One of the reasons why the OECS has been able to withstand the shocks of Stanford failure and others has been the ability of the OECS governments via the regulator to influence the financial market.
In the case of Barbados what would be homegrown options if similar occurred in Barbados.
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Carlos
David
We have little options now, our reliance would have to on the NIS funds as the government has been doing since the sale of the majority of Shares. We cannot influence anything now, decision making is now based in Port of Spain.shameful.
Mr. Arthur’s continued gloating in the nation newspaper is not doing his cause any good.
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Carlos
Mr. Justin Robinson’s contribution is based on the amount of cash one can get for the shares. If you have a house built by your own hands and with a measure of pride it is increasing in value. Would you sell to anyone because of the cash?
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Ravin’ Craven Raven
@Carlos | October 28, 2010 at 12:47 PM |
“Mr. Justin Robinson’s contribution is based on the amount of cash one can get for the shares. If you have a house built by your own hands and with a measure of pride it is increasing in value. Would you sell to anyone because of the cash?”
The real choice may be cash now vs cash later, if BNB shares continue to earn good dividends. Anyway, what would anyone do with the cash? Perhaps, buy RBL shares! Caw, caw, and caw!!
Yes NIS funds maybe the cash of last resort but the bank is the agent through the use of financial vehicles is then able to influence/regulate the market. This is the difference between the OECS and Barbados.
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checkit-out
Hi Ravin’ Craven Raven; You asked “Anyway, what would anyone do with the cash? Perhaps, buy RBL shares! Caw, caw, and caw!!”
Perhaps pay 20% of the CLICO bailout moneys! caw caw
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BAFBFP
Now time for Credit Union to have freedom to set up Credit Union Bank no? Hmm, not think what would happen to BNB without Credit Union support no? Maybe Credit Union become Bank now no?
I strongly agree should the 100% of Barbados National Bank by Republic Bank occur that the bank should change its name, otherwise it would be false advertising.
I am in a quandary however by the comments made by opposition leader Owen Arthur supporting the buy out, its not the sale of the shares thats repulsive its the below preminum price, is Owen Arthur getting soft? Its another clear cut case of Trinidadians jukking out Bajan’s eye, Why can’t the BNB shares be offered so average Bajan could buy them any way?
The issue here is that the government needs hard currency and 94 million US dollars may appear to be hitting the spot. Selling to credit unions will likely not yield such a good result. Bear in mind the credit rating agencies and others are pressing us at the moment.
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