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Sagicor and Scotiabank Signal the Caribbean Market

The blogmaster received several messages yesterday from members of the BU family whicch highlighted two financial transactions choking local, regional and some internation newsfeeds. The decision by Scotiabank to shed operations in nine Caribbean islands should hardly be a surprise to those who make it a business to keep ears to the ground. The region…

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The blogmaster received several messages yesterday from members of the BU family whicch highlighted two financial transactions choking local, regional and some internation newsfeeds.

The decision by Scotiabank to shed operations in nine Caribbean islands should hardly be a surprise to those who make it a business to keep ears to the ground. The region has become a hot mess regarding the state of economies and with de-risking high on the agenda of financial institutions the risk appetite of international banks operating in the region has reached an intolerable level. At some point in the future they will completely withdraw from a region to focus on bigger markets.

The acquisition of Sagicor shares by Canadian company Alignvest for 536 million dollars- reportedly to create the opportunity to efficiently raise capital by listing in a more liquid market to drive growth is the other mega transaction closed this week. The following statement by Sagicor’s Chief Operating Officer Ravi Rambarran about how regional stock exchanges operate is instructive:-

At the same time, our stock markets in the Caribbean are very thin and very illiquid. We saw just last week Friday someone sold 700 Sagicor sales out of 306.3 million shares and drove the price down to about USD1.00 That means all the other shareholders who have their stock had to value their stock at this price. That is a reflection of our stock market being very thin and very illiquid.

We look forward to a debate led by our educated class to inform a general public who are in the main disinterested and ignorant about these kinds of transaction. A shame!

162 responses to “Sagicor and Scotiabank Signal the Caribbean Market”

  1. WARU Avatar
    WARU

    oh well Deutche…the other shoe in the Panama Papers is starting to drop…they have not even started on Paradise Papers yet…whoever has clothes outside (ah believe that means OFFSHORE)…gotta be on the lookout FOR RAIN…lol.

    https://www.theguardian.com/business/2018/nov/29/deutsche-bank-offices-raided-connection-with-panama-papers?CMP=fb_gu&fbclid=IwAR1mWhN-8bnEAHbPyDMN97AR_N0taNv8QuW_R-T3hjUB4WP0cXwRvwN7Pb0

    Police in Germany have raided the offices of Deutsche Bank in connection with the Panama Papers revelations and as part of an investigation into alleged money laundering.

    About 170 police officers, prosecutors and tax inspectors searched six Deutsche Bank officers in and around Frankfurt, the public prosecutor’s office said. Investigators are looking into the activities of two Deutsche Bank employees who allegedly helped clients to set up offshore companies to launder money, it added.

    The Panama Papers, published by the Guardian and a consortium of international journalists in April 2016, revealed how offshore tax havens including the British Virgin Islands were used to hide billions of dollars.

    What are the Panama Papers? A guide to history’s biggest data leak
    Read more
    The prosecutor’s office said it had seized written and electronic business documents. Police cars were parked outside the headquarters of the bank, Germany’s biggest lender.

    In a statement Deutsche Bank confirmed the raid. “The investigation has to do with the Panama Papers case. More details will be communicated as soon as these become known. We are cooperating fully with the authorities,” it said.

    Records from the Panamanian law firm Mossack Fonseca were the basis of the Panama Papers investigation and included more than 10m documents. The revelations caused protests in several countries and led to the resignation of several heads of state, including in Iceland and Pakistan.

    Several banks, including the Swedish lender Nordea, have already been fined by financial regulators for violating money laundering rules as a result of the Panama Papers.”

  2. Bush Tea Avatar
    Bush Tea

    @ The Truth … (re Hal Austin)
    You are too disrespectful to all contributors but expect them to respect you, I say you need to grow up.
    …..You are one miserable old man.
    +++++++++++++++++++++++++
    You made two (2) basic errors here …which Bushie seeks your leave to correct.

    1 – Growing up will make NO difference to Hal.
    He was an idiot from his youth.

    2 – Saying that he is a miserable old man is actually misleading since…….
    He has ALWAYS been an idiot – age is not a factor in his malady.

    Thank you.

  3. WARU Avatar
    WARU

    “They said Deutsche Bank employees were alleged to have breached their duties by neglecting to report money laundering suspicions about clients and offshore companies involved in tax evasion schemes.”

    Every one of those OFFSHORE ACCOUNT HOLDERS and tax evaders will now collectively start to SHIT THEMSELVES…..ha,ha,ha…lol

    As they deserve…..

  4. A. Dullard Avatar
    A. Dullard

    @David
    “@A.Dullard
    How would legislation have prevented Sagicor from redomiciling from Barbados?”
    +++++++++++++++++++++++++++++++++++++

    Nigh impossible. But what does that have to do with poor management and long term strategy from Sagicor?
    I suggest you read Bushtea’s comment of November 29, 2018 11:43 AM. Because Sagicor is large by local standards and has been around for a long time you automatically assume that is some world class outfit. Sadly, it is not.
    Sagicor is more akin to FLOW than to SOL, i.e a near monopoly, been around for ages and just lucky to be amongst the first in the segment to do what it does. Things like lax regulation and an unsophisticated clientele don’t hurt either…

  5. WARU Avatar
    WARU

    Ah wonder why Scotia is suddenly hightailing it out of the Caribbean …just asking..

  6. Vincent Codrington Avatar
    Vincent Codrington

    @ David BU at 11 :30 AM

    If the purchased insurance companies are profitable ,how come Scotia Bank is selling/has sold them?
    Will the purchases ensure Sagicor’s viability? One can over-expand as well. This could lead to too big to regulate and too big to fail down the road. With consequences for policy holders and taxpayers.
    Of course I would not like this to happen,since I have dogs in the fight.
    Did you not report that our local regulating body was inadequate/ineffective because of the complexity of Sagicors business? How come you are trumpeting these new acquisitions /strategic financial moves?

    Of course you do not have to be consistent in your positions since you play the role of Devil’s Advocate.LOL!!!

  7. David Avatar
    David

    @A.Dullars and Bush Tea

    Sagicor is not a Bajan company.

  8. David Avatar
    David

    @Vincent

    Not trumpeting anything. You are familiar with the regulations in those two jurisdictions?

  9. Georgie Porgie Avatar
    Georgie Porgie

    Simple Simon November 29, 2018 11:22 AM

    Georgie Porgie November 29, 2018 9:12 AM “IF YA AINT INTERESTED YA AINT INTERESTED.”

    Surely Georgie Porgie who is famous for kissing the girls, knows moreso than anybody else that interest can be stimulated.

    Lolll!!!

    Simple Simon i suh wuh i hafa suh …no apologies i was just JOINing IN THE DISCUSSION, since YOU NEVER KNOW HOW EXPRESSING YOUR VIEW MAY MAKE A DIFFERENCE.

    but i agree with you i know that interest can be stimulated in kissing the girls!

  10. sirfuzzy (i was a sheep some years ago; not a sheep anymore) Avatar
    sirfuzzy (i was a sheep some years ago; not a sheep anymore)

    will a Caribbean established firm(sol Sagicor Goddars etc) that has out grown the Caribbean and now need to be globally competitive still service the Caribbean as we expect or will be be treated like and how the other global companies treat us but with possibility of Caribbean people running them or appear to be running them?

    what is the benefit for us if we get the same bad treatment but this time coming from our supposed Caribbean friends.

    We need to examine the role we are expected to play in these economic models. We may not like what role he have been cast on the soap-opera called globalism.

  11. David Avatar
    David

    What we need is a well regulated market that will attract many players. We have an affinity for supporting behemoths which occupy too large to fail status.

  12. Vincent Codrington Avatar
    Vincent Codrington

    Yes, Sir Fuzzy we need to be vigilant. We have a legacy to protect and pass on.

  13. Bush Tea Avatar
    Bush Tea

    Sagicor is not a Bajan company.
    ++++++++++++++++++++++++
    True … but is was … and should still be…

    Brass bowl idiots ALWAYS end up broke….and making shiite excuses.

  14. Vincent Codrington Avatar
    Vincent Codrington

    @ David BU at 12 :29 PM

    You sure have that right. We always had the reputation to do such. I hope we can regain and retain it.

  15. sirfuzzy (i was a sheep some years ago; not a sheep anymore) Avatar
    sirfuzzy (i was a sheep some years ago; not a sheep anymore)

    If god forbid Alignvest went belly up. The Caribbean govt and ppls will feel the pain but have no ability IMO to fix any thing as the company is a Canadian company subject to their laws and rules. This ” New Sagicor” is by Canadian players a small fish. Companies that size belly up and its seen as par for the course, the survival of the fittess etc. Capitalism at work and play.

    What can we do if we have no say on how the Canadian treat things like company bankruptcy etc.?

    We must definitely all move in with David, in wherever HOPE is located; or help him find it quick.

  16. David Avatar
    David

    The new company is subject to the laws of Bermuda.

    https://globenewswire.com/news-release/2018/11/27/1657240/0/en/Alignvest-Acquisition-II-Corporation-and-Sagicor-Financial-Corporation-Limited-Announce-Proposed-Business-Combination-and-Proposed-Strategic-Acquisition.html

  17. sirfuzzy (i was a sheep some years ago; not a sheep anymore) Avatar
    sirfuzzy (i was a sheep some years ago; not a sheep anymore)

    In the 1990 you may have invested in LOB Manulife Clico Mutual. Today less than a quarter century, CLICO is no more, its replacement is a second teir boxer in the ring ducking and weaving hoping not eo get hit to hard.

    LOB was acquired by Mutual. Manulife sold its policies to the Mutual. The Mutual became Sagicor. Looking back you may have wisely put your eggs in many baskets, but for some strange reason(s) they are mostly now consolidated into one big basket which is going to the land of corporate raiders, and vulture capitalist.

    The average bajan has some thing invested in Sagicor. He may not know it but he has. This move need to Canadian ownership need a good public honest vent; but i am sure the PR machine will be turned up to 1200% as the few may want what they want full stop.

  18. David Avatar
    David

    @sirFuzzy

    There is not one Rh a Bajan vent will change the matter at hand. The horse has bolted. No top class company will invest in Barbados in our lifetime.

  19. Vincent Codrington Avatar
    Vincent Codrington

    @ Sir Fuzzy at 12 :39 AM

    Precisely. Global competitiveness what? Nice sounding phrase but no substance.We will have lost control. And since we are small ,we will get little or no consideration. Did this not happen with overseas domiciled insurance companies within the last two decades? Some of us have very short memories.

  20. Vincent Codrington Avatar
    Vincent Codrington

    David BU at 1:04 PM

    Take it easy nuh. You must not let these developments get to you. These too will pass. The discussion is your contribution to a search for solutions. That is enough.

  21. David Avatar
    David

    @Vincent

    We cannot manage in a fish bowl .

  22. Vincent Codrington Avatar
    Vincent Codrington

    @ David BU at1:18 PM

    If the pet fish can . We will. Just play the hand we are dealt to the best of our ability. We have traveled a similar road before. The principles are the same.
    Keep your eye on the ball. You do not need to calculate the trajectory nor the velocity just keep up with the ball.

  23. peterlawrencethompson Avatar
    peterlawrencethompson

    @William Skinner
    “Is your position an endorsement of the new wave of brutal financial recolonization?”
    +++++++++++++
    Nope… I’m not a fan of foreign investment. As Vincent says, it has the odour of a search for new masters.

  24. William Skinner Avatar
    William Skinner

    @ Bush Tea

    You are correct. Using a lot of cliche and so on is most popular a la David.
    The truth is that our private sector jokers are basically clueless.
    They have an archaic retail outlook that is now useless.
    Sagicor like BST are averse to modern business practices. We are going into
    a very dark place from whence escape may prove to be impossible.
    I know something is amiss when the central bank governor can look straight in the faces of the corporate elite and say: the sale of Sagicor is unfortunate.
    Diplomatic language for: it should not happen. He chose his words very carefully.
    It is obvious that the corporate elite has decided to sell out everything and live off their billions happily ever after.
    It’s time we start calling it for what it is …..,,

  25. David Avatar
    David

    @Vincent

    This is where we differ. The solutions to our problems today require a different toolkit. To keep an eye on the ball one must have a clear view of the trajectory and accurately calculate he velocity. N’est pas?

  26. sirfuzzy (i was a sheep some years ago; not a sheep anymore) Avatar
    sirfuzzy (i was a sheep some years ago; not a sheep anymore)

    David November 29, 2018 1:04 PM

    52 year later what has really changed? We were never really fully in charge, it like been a GM with fully authority but the owner must approve what ever you want done. its a facade of indepemndence. We we good for suagr etc, then whatever else that followed. Again I say we need to examine real hard the role we are cast to paly in the economic model. We may think otherwise byut the director and producer calling the shots on the soap-opera called globalism.

  27. sirfuzzy (i was a sheep some years ago; not a sheep anymore) Avatar
    sirfuzzy (i was a sheep some years ago; not a sheep anymore)

    David November 29, 2018 1:04 PM

    @sirFuzzy

    There is not one Rh a Bajan vent will change the matter at hand. The horse has bolted. No top class company will invest in Barbados in our lifetime.

    David November 29, 2018 12:29 PM

    What we need is a well regulated market that will attract many players. We have an affinity for supporting behemoths which occupy too large to fail status.

    So tell me what happened to u in just 30 minutes. I would really love to hear or better yet know? lol

    Has Hope moved or turned off the homing beacon?

  28. Hal Austin Avatar
    Hal Austin

    Has the minister of economic affairs said anything about the sale of Sagicor?

  29. Redguard Avatar
    Redguard

    @Hal Mr. Jong needs to review and then advise whether to say nothing or release a fancy animation

  30. A. Dullard Avatar
    A. Dullard

    @ Hal
    Has the minister of economic affairs said anything about the sale of Sagicor?
    ++++++++++++++++

    First, which one?? Second, what do you want them to say?
    Do not expect any deep comments or analyses on this sale from any minister(s).
    Didn’t you see the weak comments about regret from the head of the Central Bank?

  31. Hal Austin Avatar
    Hal Austin

    @Redguard, @A. Dullard,

    After six months I am still waiting for a road map out of this economic fog. All we have is BERT, but he appears to be asleep. Our two big institutional investors should be banking and insurance, neither of which is functioning as they should. On the key issues the government remains silent.
    Barbados (the Caribbean?) is grossly under-insured. We need a vast number of protection, very few of which the locally domiciled companies want to offer. They go for the low-hanging fruit, motor insurance and life cover. We need income protection, critical illness, PHI, etc.
    It appears to me that it has taken the BLP government six months to achieve what it took the DLP ten years to do: undermine public confidence. They have alienated the civil service; pass taxpayers’ money to the wealthy, created jobs for the boys and girls, and, most of all, have already run out of ideas. It is all going to end in tears.
    Barbados is a failed state.

  32. David Avatar
    David

    @A.Dullards

    The governor’s ‘unfortunate’ comment referred to the sale of scotia bank operations.

  33. Wily Coyote Avatar
    Wily Coyote

    Wily is amazed that no one has asked who is “Alignvest Acquisition II Corporation (TSX:AQY) (“AQY”) is a Special Purpose Acquisition Corporation (“SPAC”)” and what exactly is a SPAC.

    Bloggers would do well to use your FRIEND GOOGLE and do a little research on SPAC’s and in particular Alignvest Acquisition II Corporation. This particular SPAC is setup as a short term entity and present management has NO INSURANCE experience.

    Please tell Wily exactly what Alignvest Acquisition II Corporations long term bottom line is?

  34. David Avatar
    David

    @sirFuzzy

    Hope is said to spring eternal, however, there are times it will dim because we are hamstrung by the fallibility of the human condition.

  35. NorthernObserver Avatar
    NorthernObserver

    So tell me. Assume I own 100,000 shares in Sagicor that came Via demutualization. Now I will own xxx shares in some Sagicor NEWCO, now listed in $Cdn. How does Barbadian authorities treat these new foreign stocks? I assume Barbadian owners are now subject to capital gains tax in Canada? withholding tax?

  36. NorthernObserver Avatar
    NorthernObserver

    @wc
    SPAC is a nice term for a shell company. After the Sagicor “acquisition” it will morph into new Sagicor or whatever one chooses to call it.

  37. Hal Austin Avatar
    Hal Austin

    @ Wily,

    The key is who owns the underlying assets of the SPAC, which are formed to buy targeted companies. Where is the regulator? Although Sagicor is domiciled in Bermuda and the new owners appear to be domiciled in Canada, if they are operating in Barbados the local regulator has a right to ask questions. But are they going to?.

  38. William Skinner Avatar
    William Skinner

    Up yo yesterday , Sagicor was considered the gold standard of our corporate entities. Its policy holders and agents must be in a state of shock. I recall the outpouring of shock when it decided to register else where. This is going to cause some negative fall out to the industry. One of the major sales pitches of Sagicor was that it was a Barbadian company while others were foreign owned. Their sales persons will have a difficult time in the field explaining this development. Coming so closely on the heels of the CLICO catastrophe, many potential prospects for insurance may express some reservation going forward.
    We are in for interesting times.

  39. Georgie Porgie Avatar
    Georgie Porgie

    once upon a time, a very long time children playing in de village would sing London bridge is broken down
    may i ask which bridge in Bridgetown has broken down? or is it that both have broken down
    just asking

  40. Vincent Codrington Avatar
    Vincent Codrington

    @ Sir Fuzzy at 1:04 PM

    Piece has a trinitarian theory about David BU.LOL!!!!

  41. Mariposa Avatar
    Mariposa

    https://www.marketwatch.com/story/sec-fines-floyd-mayweather-dj-khaled-for-not-disclosing-ico-payments-2018-11-29

  42. Vincent Codrington Avatar
    Vincent Codrington

    @ David BU

    @ Wily

    Has anyone discerned a pattern in the evolution of Barbadian owned corporations?

  43. David Avatar
    David

    Reposted from Facebook:-

    BREAKING NEWS: A WARNING FROM AN OECS INDIGENOUS COMMERCIAL BANKER:

    “I know you all saw the news about Scotia being bought by Republic Bank? Does anyone undersatand the consequences of this deal for the OECS?

    Scotiabank did not sell Trinidad, Barbados, Jamaica, Cayman or The Bahamas! But they sold the OECS for US$123M. In the scheme of things, not big money! But for the OECS they get control of the largest commercial bank and with that, access to the Eastern Caribbean Central Bank (ECCB) foreign currency reserves! Trinidad does not have foreign currency and now wants to take control of the OECS reserves!

    I urge all OECS citizens to advise the individual politicians to NOT ALLOW the purchase to go through! It does not benefit the OECS, only the Trinidadian companies, that will abuse our foreign exchange reserves!

    Ask yourself what will happen if we deplete the foreign reserves to the point that when normal people want to buy currency the bank says they do not have!

    They start telling you come back next week! Because some big business just purchased $US 100 Million at a time!

    Start to open your eyes to what’s going on! Do you remember Antigua and Barbuda’s Prime Minister, Gaston’s very firm letter to Scotiabank, two days ago? He revealed in that letter that such a move by Scotiabank has to be first discussed with the OECS Governments, who then need to consult with their Eastern Caribbean Central Bank principals.

    Don’t take what you hear at face value! Please my people, investigate!”

  44. Hants Avatar
    Hants

    VERY INTERESTING.

    “In Guyana where Republic Bank is in expansion mode, the government seemed similarly startled and immediately raised the issue of market dominance, over-concentration of banking services and the risk associated with “too big to fail”. By one calculation, the purchase, if approved, would give RBHL 51 percent of Guyana’s banking system’s assets and deposits. Government officials also pointed to the need for compliance with Guyana’s Financial Institutions Act and approval from the Bank of Guyana. In both cases, the comments signal the start of a different round of delicate negotiations involving national governments.

  45. Bush Tea Avatar
    Bush Tea

    @ Vincent
    Has anyone discerned a pattern in the evolution of Barbadian owned corporations?
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    The term “Barbadian owned corporation” is an oxymoron.
    This is a fact from observation and practice, however it can also be deduced logically
    as follows…

    1 – Brass Bowls do not tend to own corporations, THEY do the menial work in corporations
    2 – Even if a Brass Bowl INHERITS a corporation he will sell it to the Trinidadians
    …and then brag that it now works better than when HE ran it… all this – while doing the menial work in it.
    3 – Barbadians are consulate brass bowls. No pride; No industry; No balls.; no joke….

    Therefore, even if HANDED a Century-old corporation – Bajans would find a way to sell it to strangers (usually albino) for a mess of porridge, which usually includes a BMW… so that he can drive through the potholes while showing off to other brass bowls that he is from the upper shiite class….while they just got pissed on AGAIN…

    Seriously though Vincent … it is a CURSE.
    We have been BEWITCHED.
    We CANNOT even fix a BASIC sewer system Vincent…
    We cannot fix pot holes…. Vincie
    We cannot figure out how to exists without crawling to Baloney… Codgie…

    Bushie is TIRED of explaining that the big, ugly, piece-of-SHIITE at the Garrison is the SYMBOL of our National CURSE…
    This was the ONLY thing that the idiot Fumble was able to complete successfully… an ALTAR to Satan …complete with a big black pitch fork… no wonder the South Coast is shit-infested….

    What the hell did we expect…?

  46. WARU Avatar
    WARU

    Ah trying real hard to keep up here, real hard..lol

    so what’s next…3 years of investigations into Panama Papers, ah guess Paradise Papers still ongoing, glad ENUFF I have no OFFSHORE ACCOUNTS…lol, anything can happen next, wonderful..

    https://www.facebook.com/jackie.stewart.965/videos/925075287702011/?t=0

  47. David Avatar
    David

    The following comment was posted in T&T social media space linked to this blog:

    These so-called stock exchanges in the Caribbean are corrupt Old Boys networks, scams, a nasty trick played upon the people, dinosaurs preserved to benefit the scammers, unwilling to modernize and open up, robbers’ dens for the 1% and the powerful elite. Governments facilitate and even hep them openly to continue robbing the people.

    And, then have the IFC, a super scam, a worthless piece of shit that consumes our hard-earned $$, a ruse, a trick, a con game, nothing more than that. Is the IFC involved in the plan to bring in Chinese banks to decimate the local banking sector via predatory & monopolistic banking practices?

    We will once again recommend a few strategies to improve the local Stock Exchange; you cannot talk about IFC when your Stock Exchange and other financial issues are mired in the Stone Age.

  48. David Avatar
    David

    https://youtu.be/UMPhmdm52xU

  49. Bush Tea Avatar
    Bush Tea

    How is that different from Emera?
    Only in that Sagicor changed name from Barbados Mutual BEFORE the sellout
    …while BL&P changed name to Emers AFTER their sellout.
    …and BS&T changed to Massa after theirs..

    Same difference..
    Parros selling family assets in order to look rich and live big for a short time
    Brass bowls…!!!

  50. David Avatar
    David

    @Bush Tea

    The reality is that Sagicor is not a Bajan company based on ownership of shares.

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