Wednesday, July 30, 2008

Green needs to leap hurdle not cleared in 5 years

Published: Wednesday July 30, 2008

Phil Green, Cable & Wireless Jamaica (C&WJ) president, needs to grow earnings by some eight per cent to about $3 billion EBITDA in order to appease London's dissatisfaction with Jamaica's performance.

Green inherited a bad situation from his predecessor, Rodney Davis, but if he cannot steer the company in line with growth targets of the wider division, he may not last long. The target, set by the parent, Cable and Wireless plc and hidden in its annual report, is a combined goal for the international division which includes Jamaica, Panama, the Caribbean, and Macau and Monaco. Next to the Panama operations, Jamaica contributes the single most to the operations earning, so its performance significantly influences the performance.

"We expect EBITDA [earning before subtracting loan interest, depreciation and amortisation or EBITDA] for 2008/09 to increase by eight per cent to 10 per cent to between US$895 million and US$910 million," said John Pluthero, executive chairman of international in the C&W plc annual report, "and our EBITDA margin to be approximately 35 per cent."

It is significant because C&WJ has declined to give growth targets for investors. The figures give a benchmark by which investors can judge its performance. C&WJ's EBITDA margin (EBITDA/revenues) was 12 per cent, even though the company wanted around 35 per cent for its 2007/8 financial year. Others in the division achieved the target, but Jamaica did not. In dollar terms, C&WJ was a disappointment, as its EBITDA declined from $6.98 billion to $2.78 billion up to March. Much of the loss was due to a prepaid landline policy which significantly contributed to a $2 billion drop in annual revenues to $22.8 billion to March.

Green is banking on recouping these lost billions, having recently reorganised the prepaid landline service. If he can build back those revenues and keep expenses at bay, then he will meet the target.

None of Green's three predecessors have been able to meet the parent's EBITDA targets since 2004. They include Gary Barrow, who left in 2004; Jaqueline Holding, who left in 2005; and Davis, who left in 2007. The international division wanted EBITDA margins between 34 and 37 per cent for its subsidiaries between 2004 to date. Jamaica's EBITDA margin was consistently below at: 27.9 per cent in 2004; 29 per cent in 2005; 29.3 in 2006; 28.2 per cent in 2007; and 12.1 per cent in 2008.

Pluthero added that if Jamaica's operations were excluded, the international division's returns would have rocketed.
"We grew our EBITDA by three per cent compared with 2006/07 to US$830 million, representing an EBITDA margin of 34 per cent," said Pluthero. "Excluding Jamaica, our EBITDA would have increased 12 per cent and our EBITDA margin would have been 37 per cent."

Green is the second president in recent times to be transferred from the Pacific Islands. Jacqueline Holding was the first. Green comes having attained EBITDA of 53 per cent in 2005/6. He was aided by the bustling economies of the islands growing at 8-10 per cent. Holding's performance in the Pacific Islands was similarly exemplary, however her stint at C&WJ did not last a year.

Source: Jamaica Oberver

Lascelles to market Angostura products

Published: Wednesday July 30, 2008

Lascelles Limited, a subsidiary company of the Wray and Nephew Group, will be distributing the full range of Angostura Limited's products in the Jamaican market with the exception of one.

Michael Carballo, executive director of Angostura, said his company was not looking to dominate the market.

The products launched here Monday included Angostura's low-sodium teriyaki, soy and worchestershire sauces, aromatic bitters, Caribbean club rum punch, Angostura 1824, Royal Oak and Angostura 1919.

The launch occurred on the same day that Angostura and parent CL Financial Group completed the US$9.25 per share purchase of Wray and Nephew's parent, Lascelles deMercado, to secure an 81 per cent stake in the conglomerate.

Lascelles started distributing Angostura's products on July 21, having taken the distributorship of Angostura Bitters from T. Geddes Grant Limited and Caribbean Producers Jamaica Limited, which represented Angosutra's Hard Wine.

"We are going to represent all of their products except for the lemon lime and bitters," said Bruce Terrier managing director of Lascelles Limited, referring to a canned product called LLB distributed by Wisynco Group Limited.

"We've improved the distribution already and have already got it into more places," Terrier told Wednesday Business.

Terrier said the distribution arrangement would represent less than five per cent of Angostura's worldwide sales, and that the rum products was expected to corner a minute share of that market here.

"I don't think we'll achieve more than one per cent," said Terrier.

"It's just very difficult to get market share in the rum market," he told Wednesday Business at the launch of the products at Devon House in Kingston on Monday.

Carballo said they would be going after the tourism market, but would not comment on volumes.

There are no plans, the companies said, for the Lascelles group to manufacture any of Angostura's products here.

Susan Gordon
Jamaica Gleaner

NCB scores big - But Hylton expects slowdown in periods ahead

Published: Wednesday July 30, 2008

Nine months into its financial year, National Commercial Bank (NCB) has already chalked up another record for big profits of $6.76 billion, or $2.74 per share, to surpass its performance last year when it reported profits of $6.6 billion over 12 months.

But group managing director Patrick Hylton has signalled that profits may not be as robust in the coming periods, and that momentum was likely to slow in 2009.

The banking group will pay $740 million in quarterly dividend to its 34,828 stockholders on August 27, or 30 cents per share, bringing total dividend within this year to $2.146 billion.

Big boost

Profits grew 38 per cent in nine months to June 30, on gross revenues of $28.8 billion, up from $25 billion in the comparative 2007 period.

But the bank also said its bottomline was boosted by a one-off gain of $517 million which, when excluded, showed profits growing by 28 per cent, the bank said.

The gain related to the man-datory sale of a portion of NCB's Visa shares under the credit card company's restructuring and initial public offering.

Hoping for more success

The banking side of the group brought in the lion's share of profit, $4.6 billion, while its investment arm, NCB Capital Markets Limited, contributed $1.36 billion and insurance $435 million.

NCB is making no bets on where its profits will end up at its financial year-end in September, but according to Hylton, the last quarter could be less stellar than the first three periods,.

"For the fourth quarter, we will be looking to continue on our path of organic growth while trying to improve on our cost to income ratio, and our overall efficiency," he told Wednesday Business.

"We will be striving to exceed expectations, but given the current economic climate, we acknowledge that we face significant challenges in maintaining our momentum in the coming fourth quarter and the next financial year."

Growth in loans portfolio

Important for the bank, in an area where it trails big rival Scotiabank Jamaica, NCB's loan portfolio advanced 35 per cent year on year, from $53 billion to $71 billion, making the portfolio the largest contributor to balance sheet growth in the period.

Its loans to assets ratio rose four points, from 21.6 per cent to 25.6 per cent, as a result.

The bank told Wednesday Business that it launched a number of campaigns targeted at loan growth in the year to June, but was focused on initiatives and products that it thought would best boost its loan asset ratio.

"The increase in our loan book is due to increases in both our corporate and retail portfolios," it said.

Slow deposit growth

But NCB also boasted of beating the industry average, saying its net loans grew 28.5 per cent, well ahead of the commercial banking sector's 19 per cent.

The bank's total assets also climbed by $36 billion to $280 billion, while its capital base was weightier at $32 billion.

Deposits, though reflective of new business, grew at slower rate of nine per cent to $119 billion.

The bank, which follows second behind Scotiabank as the most profitable listed companies on the Jamaica Stock Exchange, has returned quarterly profits on average of $2.25 billion.

On that basis, assuming its fourth quarter tracks with current performance or matches the 2007 period, NCB group is set to round out 2008 with net income of about $8.5 billion to $9 billion.

Lavern Clarke
Jamaica Gleaner

Trinidad stock exchange to trade depositary receipts

Published: Wednesday July 30, 2008

The Trinidad and Tobago Stock Exchange (TTSE) is to introduce trading in depositary receipts (DRs), but meanwhile the plan awaits legislation that will guide their regulation.

Charles De Silva, deputy general manager of the Trinidad and Tobago Securities and Exchange Commission (TTSEC), said his agency had already made recommendations to the finance ministry on the regulatory framework required, which in turn will guide legislative action.

"That's the status right now," De Silva told Wednesday Business.

In addition to the by-laws, other changes have been proposed to the income tax act and national insurance laws to recognise DRs as domestic securities.

Wayne Iton, TTSE general manager and chief executive officer said the laws would have to be amended to create the platform for the trading of the securities.

"We are doing what we have to do by making sure we have that platform," he added.

Tradable security

A depositary receipt is a tradable security, usually in the form of equities that are listed on an exchange, issued by a foreign company which allows for ownership in that company beyond its home borders.

Interest in DRs was triggered by the US$2.2 billion acquisition of RBTT by Canadian-based RBC.

RBC, under that arrangement, agreed to issue depositary receipts in the market where the merged banking operations would be headquartered, Port-of-Spain, once the primary transaction was complete. The deal was sealed at the end of June, but the merger of the Caribbean operations of RBC with that of RBTT, under the umbrella of RBC Caribbean, is expected to last three years.

Nicole Duke-Westfield, external affairs manager of RBTT also confirmed that both financial houses have been working with Trinidad's securities commission and stock exchange on the establishment of a market for DRs.

"In terms of its timeline or its inauguration, that's a matter for the SEC," she added.

De Silva also sees DRs as a mechanism for domestic investors to enter the foreign market.

"We think the conditions are certainly propitious for investors. This will allow for greater scope of investing in the DRs, increase the level of investment and increase the level of diversification," he said.

TTSEC's chairman and CEO Osborne Nurse during a recent address to business leaders said the commission was strongly of the view that sufficient market interest exists or will emerge for depositary receipts issued in Trinidad that are based on the shares of important energy companies operating in the country such as BP, BHP Billiton and Mittal.

"The issue of depositary receipts in such companies would allow the average Trinidad and Tobago investor, many of whom do not have the capacity or resources to access these shares in metropolitan markets, an opportunity that we think will be most welcome to participate and share in some way in the fortunes of these companies and of Trinidad and Tobago."

Nurse said although the SEC had contemplated recommending the introduction of depositary receipts as a mechanism through which Mittal could discharge its obligation to issue shares to its employees, it was the RBC/RBTT transaction that provided the opportunity for the Commission to propose the legal framework.

"In our view, the RBC/RBTT transaction could not be allowed to result in the substantial reduction of securities and of value available on the stock exchange and we therefore strongly encouraged RBC to replace that value on the exchange."

Source: Jamaica Gleaner

Salada 9:1 stock split - Analysts say action may be futile

Published: Wednesday July 30, 2008

Salada Foods, the Jamaican firm that manufactures and packages instant coffee, is planning to a nine-to-one share split aimed, the company says, at creating liquidity in the stock.

But while welcoming the move to stimulate trading in Salada, analysts warned yesterday that the strategy could could come to naught if big shareholders, like Donovan Lewis, who, mainly through his Ideal Group of companies, holds more than 70 per cent of the firm, continue to hold the stocks closely.

"Although the nine-to-one stock split would increase the number of shares outstanding, it would not necessarily allow for that much more liquidity to trade ," said Jason Dear, equity trading manager at First Global Financial Services.

More than 70 per cent

"The major shareholders hold more than 70 per cent of the shares."

Salada, which is listed on the Jamaica Stock Exchange (JSE), currently has 10.4 million outstanding shares, few of which generally see activity on the exchange.

When the stock last traded on July 22, it traded down by $2 to $133 on 800 units.

But on the weekend, the exchange reported that it has been informed by Salada's directors of their plan for the share split, out of 489.6 million new shares that are to be created.

The new shares, plus the existing issue, will give the company 500 million authorised shares, just under 21 per cent will be issued.

"The reason (we are doing this) is to try and make them (Salada stocks) more affordable when they come on the market," said the company's managing director, John Rosen.

More shares

"We are trying to bring some liquidity in the market and hopefully more shares will be available."

Outside of the cross-listed stocks, Salada is the second-most expensive on the Jamaican exchange, trumped by Lascelles which is trading above $600 per share.

The proposal by Salada, however, will have to be formally endorsed at an extraordinary general meeting of shareholders on August 28, an undertaking that is likely to be easy given Lewis' big stake in the company.

The other substantial shareholder is Advantage General Insurance, which is controlled by billionaire Michael Lee Chin, a close friend to Lewis.

Lewis consolidated his hold the company with the acquisition of additional shares last year to boost his more than 60 per cent share to his current holding.

Mayberry Investments had tried to buy a bigger slice of the company through an improbable take-over bid of its own.

Lewis ignored the offer, stopping Mayberry dead in its tracks.

But even with a big bank of shares now available, brokers stressed that they would have to see the posture of the big players in Salada before coming to a conclusion on its impact on liquidity.

"It (the share split) will theoretically increase the amount of liquidity and trading of the stock, but it will depend on whether the current shareholders who closely hold the stock have any need or will want to sell any of their holding," said Johann Heaven, vice-president for planning and analysis at Scotia DBG.

Susan Gordon
Jamaica Gleaner

Stockbroker warns of 13 per cent inflation

Published: Wednesday July 30, 2008

Stockbroking firm, Caribbean Money Market Brokers Ltd (CMMB) has said that it expects inflation in T&T to remain at high levels between 10 - 13 per cent for the rest of the year.

In a statement yesterday, CMMB said its expectation was based on the fact that there was “no visible abatement in government spending on the horizon.”

The Central Bank last Friday announced that the country’s inflation rate had reached a 14-year high of 11.3 per cent at the end of June.

This represented an increase from 10 per cent at the end of May and 7.3 per cent at at the end of June last year.

CMMB said “we expect that inflation will remain at elevated levels and should range between 10-13 per cent for the rest of the year.

Given this expected trend, together with the gradual tightening in TT dollar liquidity, interest rates should also increase.” It added that, “The repo rate should also increase by a further 50 basis points to reach 9 per cent by the end of 2008; an historic high from its inception.”

The Central Bank last Friday increased the Repo rate from 8.25 to 8.50 per cent.

CMMPB said it was not surprised at the increased in the inflation rate.

It said that, “The situation is exacerbated as core inflation, which strips away the volatility of food prices, rose significantly to 6.4 per cent year-on-year in June, versus 5.2 per cent in May. This was almost solely driven by the rise in the price of electricity, as rates for residential consumers increased between 14-48 per cent.

According to CMMB, “Core inflation is very important, as this represents the inflationary pressures emanating from within the economy. This is the component of overall inflation which the Central Bank has some control over.

The prices of food and energy products which trade on the international markets are out of their control. They are exogenous to our system, thus we are virtual price takers in this regard.”

The firm said, “The Central Bank vainly hopes that their hikes in both the repo rate and the cash reserve requirement for commercial banks will have an impact on the financial system. However, we observe that credit expansion continues to surge, increasing in excess of 18 per cent, with consumer credit and mortgage loans outpacing the growth of business credit.

The company said that by increasing the cash reserve requirement for commercial banks the Central Bank had reverted to measures which it had deemed “archaic” not too long ago.

“The view from the Central Bank tower clearly indicates that drastic times call for drastic measures,” CMMB said, adding that, “The irony of using the tools the CBTT has at its disposal is that, unfortunately for us, they have all been tried before and, regrettably, they all have failed before. It’s difficult to envisage a different result this time around.”

CMMB said among the Central Bank’s options are to limit fiscal injections, shock the system with a big increase in interest rates, reduce the food import bill, by providing incentives for agriculture locally or by temporarily removing import duties on basic/staple food items.

Source: Trinidad Guardian Newspapers

Tuesday, July 29, 2008

New Scotia boss - Bruce Bowen to head local arm of Canadian-based bank

Published: Tuesday July 29, 2008

The board of the Bank of Nova Scotia Jamaica Ltd yesterday named Canadian Bruce Bowen as the bank's new president and CEO.

The revelation follows this month's shock announcement that William 'Bill' Clarke will retire after 40 years with the institution.

Bowen currently serves as president and CEO of Scotiabank Puerto Rico. He is expected to replace Clarke come October 31, when the retirement becomes effective.

For the good of customers

"Together with the board and the strong Scotiabank Jamaica management team, I know that Bruce will continue to build on Scotiabank's tradition of strong leadership and commitment to customers, employees and the Jamaican market," said Robert Pitfield, chairman of the board of Scotiabank Jamaica.

"Mr Bowen has been a key contributor to our success in the Caribbean and we look forward to having him rejoin the Scotiabank Jamaica team," a spokesperson for the bank said in a press release.

Bowen is expected to return to Jamaica with his wife and five children.

Pitfield also lauded the outgoing CEO for his contributions to the organisation.

"Bill has done a tremendous job for Scotiabank, playing a key role in our success," he said. "The board very much appreciates his contribution, and I know that I speak for all Scotiabankers in wishing him all the best in his retirement."

Clarke announced his plans to retire nearly two weeks ago after serving four decades with the international financial institution. His retirement comes four years earlier than expected and amid conflicting reports that he had been asked to leave.

Financial analyst, Errol Gregory, said yesterday that he did not know Bowen, but although Clarke would no longer be at the helm of Scotiabank, he was confident the bank would be able to maintain its position as the leading financial institution locally.

"There certainly is an extent to which there is no denying Clarke's exceptional dynamism. He spearheaded many successful initiatives as head of Scotiabank," Gregory said.

He, however, argued that Scotiabank's established systems have contributed to its track record of success.

Gregory said, over the years, the bank has been able to market itself as a safe and sound financial institution that Jamaicans could trust. This tradition, he said, would continue.

Who is Bruce Bowen?

Has been with Scotiabank for 18 years.

His international experience includes positions in Cayman, Trinidad and Tobago and Jamaica.

His most significant banking role has been as the president and CEO of Scotiabank, Puerto Rico.

Source: Jamaica Gleaner

Sagicor Jamaica to acquire Blue Cross portfolio

Published: Tuesday July 29, 2008

Sagicor Life Jamaica Limited has confirmed that it is acquiring the health portfolio of Blue Cross of Jamaica.

However, while the parties have an agreement in principle, the deal still has to face the scrutiny of regulators.

"We have signed an agreement," Sagicor Jamaica president Richard Byles told The Gleaner on Monday. "It is subject to regulatory approval and we have to do our due diligence."

Hours after, Sagicor Jamaica, which is a publicly listed company, issued a press release announcing the deal.

Health-insurance monopoly

Sagicor, with $33.76 billion of assets, is nearly 17 times as large as Blue Cross, whose assets are estimated at $2 billion.

The acquisition, if approved by the Financial Services Commission, will give Sagicor Jamaica a near lock on the health-insurance market, leaving only Guardian Life as rival.

Sagicor Jamaica last month laid claim to 55 per cent of the health-insurance market.

Cost-efficient service

Blue Cross has been on the market for some time. At one point, National Commercial Bank was set to buy the insurance company, but that deal was scuttled after regulators knocked it down.

More recently, Jamaica National was said to be in talks with Blue Cross.

Byles, in the joint release on Monday, said Sagicor would be able to deliver a more cost-efficient service to Blue Cross clients.

Dr Henry Lowe, chairman of Blue Cross, said the merger would give clients access to a wider range of products and services.

Source: Jamaica Gleaner

Monday, July 28, 2008

OCM half-year profit $53m

Published: Monday July 28, 2008

One Caribbean Media Ltd, the parent group of the Express newspapers and TV station CCN-TV6, has posted strong profits for the first six months of its financial year.

The group's profit before tax of $53 million was a 15 per cent improvement over the $46 million in the corresponding period a year earlier, OCM chairman Sir Fred Gollop said in published unaudited results yesterday.

OCM Ltd also has media interests in Barbados.

Profit attributable to shareholders stood at $39 million, 14.7 per cent higher than the $34 million in 2007.

The profits were driven primarily by revenue growth of 12 per cent from the $245 million for the six months under review, compared to $219 million in the first half of 2007, Sir Fred said in his chairman's review.

Earnings per share were $0.59, up 13 per cent from $0.52 in 2007.

"Given current indicators, your directors expect that the results for the second half of the year will consistent with the pattern of previous years, where most of the growth in revenue and profits occur in the second half," Sir Fred said.

He also noted the retirement of chief executive, Craig Reynald, and his succession by Dr Terrence Farrell as new CEO and director of the OCM Group.

Farrell said yesterday the group had a solid first-half performance with revenues and profitability up strongly in both the Trinidad and Barbados media subsidiaries.

"Both companies in Trinidad-the Express and TV6-performed well; particularly the Express and the Barbados firms performed well also," he said.

Directors have approved an interim dividend of $0.26 per share, which will be paid on August 28 to shareholders on record as at August 18.

Source: Trinidad Express Newspapers

Consumers have clout, says Hutson

Published: Monday July 28, 2008

MINISTER OF TRADE, Industry and Commerce George Hutson is advising consumers to shop around.

He was responding on Friday to an Arawak Cement Company announcement earlier in the week that, as of Friday, the cost of a 42.5kg bag for "authorised distributors" would be $17, a rise of $2.83 per bag.

There was a $1 increase in April.

The company also announced that semi-bulk cement would increase by $67.08 for a 1.5 tonne bag to $402.48, while bulk will move to $367.64 per tonne – an increase of $61.27.

But, said Hutson, the consumers have the ultimate power.

"Consumers are in the best position to put pressure on those business houses to bring down the prices or decide not to buy, and they need to shop around.

"You need to look and see what the various retailers are selling their products at and look for the price that is lower and also to watch for the little tricks of trade that the retailers do, like adding in delivery into the price and things like that," he told the DAILY NATION.

Hutson said he understood that the recent price jump was a result of increasing cost of raw materials and some overheads.

"But a lot of their calculations and cost of overheads are on numbers up to the end of June, which at that time, prices were going up, and that is the kind of representation that they have made to us showing operating losses over the first half of this financial year. They are just reacting to that," he explained.

Hutson warned that it was no longer practical for Government to continue "that regime of subsidies that we had implemented earlier in the year".

"And I am not sure what the local retail price of cement will be. We haven't met with the retailers at this stage but there is an awful variation in the actual retail price of the cement, so I guess the retailers will pass through as much of the costs as possible to the consumers and we would probably have to absorb some of the others."

Chief executive officer of the Trinidad Cement Limited, parent company of the Arawak Cement Plant, Dr Rollin Bertram, said on Thursday night on Starcom Network's radio programme Tell It Like It Is, that the company "examined the costs of importation of a competitive product and we have determined that the price that we are now offering is a competitive price".

"We know that they are concerned about a monopoly because they see Arawak as the only cement in Barbados . . . but we ensure that our prices are comparable to the import costs and that Barbadians are getting value for their money."

Source: Nation Newspapers

Global issues slow growth

Published: Monday July 28, 2008

IT HAS BEEN confirmed: worldwide heavy prices on oil and other commodities and a sluggish global economy are taking their toll on local economics.

Last Friday Central Bank of Barbados governor Dr Marion Williams said that for the first time in five years, growth in the economy's total output for the first half of the year fell significantly below the average 3.6 per cent.

She indicated that economic output was virtually flat from April to June and "as a result, total output growth was limited to an estimated 1.4 per cent".

Williams presented these facts in her review of the economy for the first six months of 2008 at the Central Bank, Tom Adams Financial Centre, The City, and reality matched the forecast she gave at the end of the first quarter.

"The economic outturn for 2008 will depend largely on the performance of the international economy," she had said.

Last week she reported that: "The real pace of economic activity in Barbados was constrained by persistently high international prices for oil and other major commodities, as well as the slowing global economy."

These exogenous factors rippled sectors such as tourism and construction.

"First-quarter tourism output growth of almost 13.0 per cent was partially outweighed by an estimated decrease of 9.8 per cent in the second quarter. . . .

"Activity in the construction sector fell by an estimated 6.7 per cent . . . [and] had a somewhat dampening effect on utilities production, with output of electricity, gas and water contracting by an estimated 1.4 per cent," she noted.

The circumstances hampered Barbados' fiscal position, negatively affected employment, and inflated retail prices.

According to preliminary estimates for the half-year, Government recorded a $294.3 million fiscal deficit, more than twice the amount ($142.9 million) for the same period last year.

Also, said Williams, "An ever-present feature of economic activity during the six-month review period was the upward trend in domestic retail prices. In addition, the most recent labour market data for the first quarter of 2008 indicate that the unemployment rate was slightly higher that the comparable rate at the end of the first quarter of 2007."

Considering the rest of 2008, the governor again pointed to international economic affairs to gauge likely real output growth which she estimated to range between 1.5 and 2.0 per cent.

Source: Nation Newspapers

Friday, July 25, 2008

Bank of St Lucia launches wealth management fund

Published: Friday July 25, 2008

The Bank of Saint Lucia Limited has launched a wealth and asset management fund, with a top official hailing it as a visionary move.

"We have gone where no one has gone before in banking," said Robert Norstrom, the bank's General Manager and Managing Director of East Caribbean Financial Holding Company (ECFH) Limited.

He said the launch was the realisation of an idea that was born in January of 2006. At the time, Norstrom explained, the plan was to expand the international bank to Bank of Saint Lucia International. Plans were also in place to expand the ECFH subsidiary, EC Global Insurance, regionally and finally to review the Investment Banking Department to position it as a regional player.

The department is managing funds in excess of EC$200 million and Norstrom said it therefore reached a stage where it became necessary to streamline operations to provide customers with seamless service.

"Wealth and asset management is a very fluid business. The fluidity is derived by the constant rebalancing of investment portfolios to reflect ever-changing financial market conditions," said Mark Cadet as he took up his new position as senior manager of the bank's Wealth and Asset Management.

He added that the department's success would be dependent not only on its ability to take advantage of upswings and downswings of specific pricing instruments and overall market conditions, but also the availability of technology and the right personnel.

Bank of Saint Lucia's investment functions will be further strengthened with the launching of a full-fledged Brokerage and Merchant Banking subsidiary which will be the first in the region.

Source: Jamaica Observer

The return of the native

Published: Friday July 25, 2008

On Wednesday evening the chairman of NCB, Michael Lee Chin, made a memorable return to his hometown of Port Antonio where he unveiled the opening of an NCB branch located on West Street, Port Antonio.

Lee Chin renovated the old courthouse, which was built 103 years ago and now houses the Port Antonio branch of NCB. This exercise came in at a cost of J$130 million with the National Heritage Trust (NHT) playing a considerable role in the endeavour.

The event was a civic affair with many locals watching the ceremony, which was charaterised by pageantry. It was a poignant moment when the local boy-made-good-a-foreign was acknowledged as making a significant contribution to the community and his country.

Lee Chin recalled that as a ten-year-old boy in 1961, he often looked out to the sea from Titchfield Hill and wondered how he could own the supermarket in which his parents worked. Forty-five years later, he is the only billionaire to hail from Port Antonio building one of the largest mutual fund companies and acquiring Jamaica's largest indigenous commercial bank, NCB. His business interests have also expanded into tourism, telecommunications and the media.

Standing at the footsteps of the old courthouse and addressing the crowd as the sun began its slow decent, Lee Chin embodied how education and hard work can spell success for his fellow Port Antonians - that the dream is not impossible, and that returning home and making a significant contribution was both edifying and fulfilling.

He once again reiterated that it was important that foreign companies should not simply repatriate profits abroad but should plow them back into developing Jamaica. He said that not one dollar of profit from NCB is repatriated to AIC in Canada, adding that he wanted to play a role in the development of both his hometown and all of Jamaica.

Lee Chin drew the analogy of sand dredgers coming from a broad and taking the sand from Port Antonio beaches back to their countries overseas. He pointed out that if that continues there would be no more beaches for locals to enjoy.

Lee Chin is perhaps the only Caribbean tycoon to make a concerted effort to revitalise his hometown and make significant investments there that will create jobs and spur growth. He subscribes to the aphorism, doing well, by doing good. His endeavours take on a certain piquancy bearing in mind the Johnny-come-latelys who have crashed and burned with their schemes, without making any significant contribution to the country.

Lee Chin's Port Antonio projects include, the renovation of the Trident Hotel at a cost of US$20 million; significant work on the Blue Lagoon property at an estimated cost of US$10 million; the housing of the Port Antonio branch of NCB in the old court building, J$130 million and the construction of a state-of-the-art new courthouse building, which should come in at around US$8 million. Working with the Port Authority on the entire east Harbour including Navy Island and the northwestern tip of Titchfield Hill (which was established in 1723) to bring commercial and residential opportunities at an estimated cost of US$200 million. To date Lee Chin's ventures has employed 550 people and on completion with provide many opportunities for the people of Port Antonio.

It must be borne in mind that Port Antonio has not seen any significant development since 1939. When the likes of Errol Flynn came to town, they only built residences for themselves with no effort made to leave infrastructure behind. Nearly 70 years later, Lee Chin has led the charge for the revitalisation of this verdant part of Jamaica, and others have followed suit. He did so when the roads remained in serious disrepair and no airport existed. Those may have been major impediments to any developer, but he pressed ahead with a vision of Port Antonio etched in his mind. Port Antonio may well become a high-end tourist destination and the must-go- place to visit in Jamaica. Much of that will be due to the irrepressible Michael Lee Chin, the boy from Titchfield.

Source: Jamaica Gleaner

FirstCaribbean bank indicted under money laundering law

Published: Friday July 25, 2008

A court hearing in which FirstCaribbean International Bank (FCIB) in Belize is facing more than 100 charges has been set for September 4 by that country's Chief Magistrate Margaret McKenzie.

The bank has been indicted on allegations of failing to report suspicious money transactions between 2001 and 2005.

FCIB country manager, Glen Smith, appeared in court Tuesday in Belmopan to answer the 113 charges that were laid against the bank earlier this month, following an investigation by Belize's Financial Intelligence Unit (FIU).

Failure to disclose

The FIU said that FCIB had contravened the Money Laundering Act. It said that between January and August 2005, the bank failed to disclose that it had facilitated the conversion of large sums of money to United States currency.

A report from the unit disclosed that as much as US$8.5 million could have been withdrawn from the bank, in single transactions of up to US$1 million by the Belize Telecommunications Limited (BTL), a company that has since been dissolved.

The investigation also found that FirstCaribbean had not kept copies of the processed cheques and facilitated the transactions through two BTL employees who purchased US dollars from money traders on the parallel market.

No comment

Smith said that he had no comment to make on the legal matter.

"It is sufficient to say that the bank will vigorously defend its good name and its brand," he said.

"We are very confident in the justice system of Belize that we will be vindicated."

The chief magistrate has ordered disclosure of evidence to be presented by September 4.

Belize is one of 17 markets in which the regional banking powerhouse operates.

The banking group, which is headquartered in Barbados, is the region's third largest with assets of US$12.3 billion and 100 branch operations that service some 800,000 accounts.

FCIB is more than 90 per cent owned by Canadian Imperial Bank of Commerce.

Source: Jamiaca Gleaner

Shareholders chide board for C&WJ losses

Published: Friday July 25, 2008

Shareholders attending Cable and Wireless Jamaica's 21st annual general meeting (AGM) stopped short of blaming the board of directors and management team for not intervening sooner to stem losses at the firm.

The company in a year accumulated $2 billion of losses, wiping out $2 billion of profit in 2006, and sparking concerns about the company's future here by investors.

One particular shareholder said at the meeting that he had expected the company to announce its exit from Jamaica after news that C&WJ's parent company, C&W plc was disappointed with its performance.

"I came here expecting to attend the funeral of Cable and Wireless Jamaica," said the shareholder.

The AGM was held on Wednesday at The Jamaica Pegasus hotel in Kingston.

Over its last financial year ending March 31, 2007 Cable and Wire Jamaica (C&WJ) had to write-down $5.14 billion from impaired assets.

The company's new president Phil Green said in May that the company had written off its mobile infrastructure and would be rebuilding that side of the business.

C&WJ suffered a net loss of $4.19 billion some of which was due to unprofitable product offerings, according to Green, who took over the company in August, replacing Rodney Davis.

Bad year

Green, who is also a member of the board, on Wednesday attempted to allay shareholder concerns, by being frank but reassuring.

"It was a bad year but we caught it in time," he said.

"We fixed it and we had a better half year."

But the meeting was not so easily appeased, and shareholders continued to press the board on how it allowed the company's spending to gallop.

"We detected the problem in May," said chairman Leonard de Barros in defence.

London moved swiftly after that, he said, to correct it.

Three months later, Davis was out, and Green was in.

His immediate task was to review products, contracts and systems. In 10 months, he has reshaped the C&WJ stores into customer-focused operations, revised the Homefone product, negotiated two corporate contracts worth $900 million, done away with the Anyone mobile plan, and is in the process of planning out a project to upgrade the company's cellular network to 3G capability.


In the periods ahead, the focus will turn to cost-cutting.

"Lowering our expenses is our main objective this year," said the chief financial officer Jorge Diaz adding that 40 per cent of the company's expenses is employee-related in a hint at further redundancies.

Diaz said C&WJ was predicting a profit this year.

Susan Gordon
Jamaica Gleaner

Jamaica Broilers to double ethanol plant

Published: Friday July 25, 2008

Jamaica Broilers on Wednesday decided to proceed with the expansion of its ethanol business, and will pump US$15 million (J$1.1 billion) of new capital into expanding the plant at Port Esquivel.

The project will double capacity from 60 million gallons of wet ethanol to 120 million gallons of fuel grade ethanol, Broilers said in a stock market filing Thursday.

The company had said the project was under consideration after snagging $6 billion of ethanol sales in 10 months on a better than expected 45 million gallons shipped to the United States.

The plant was built for under $1 billion and commissioned last July.

Poultry dominant

Broilers' poultry business remains its dominant operation, but its $8 billion of sales last year to May 3, 2008, maintained only a slight edge over ethanol, whose revenues, when annualised came in at $7.2 billion.

Broilers says the additional capacity would be commissioned by December.

The project will also give the JB Ethanol Limited plant an additional 10 million gallons of storage capacity, for total storage of 24 million gallons.

Source: Jamaica Gleaner

Broilers gives up on fish export - Expects to profit from decision

Published: Friday July 25, 2008

Jamaica Broilers Group has shut down its export fish operation, effective July 1, a decision forced on the company by a resistant market that would not pay more for its fresh fillet, leaving the company to suck up higher production costs as raw material and fuel prices escalate.

Broilers, whose fish business falls under subsidiary Jamaica Aquaculture Limited, says it will give up revenues of $250 million that its fillet earned from supermarkets supplied in the United States and Europe.

"The "supermarket chains were not prepared to accept the increases necessary to cover the increased cost" and consequently "the business became unprofitable," said vice-president of finance and planning Ian Parsard.

Faced with higher grain prices, it became more costly to feed and grow fish.

The price of corn, which the company imports for its feed processing business, has been advancing on the world market, hitting a record US$6 per bushel last week.

In Jamaica, where consumers are more tolerant of price hikes, some costs have been passed through to chicken, with the average bird at local grocers costing some $500.

Broilers was hoping to similarly pass off some of the costs on its foreign-bound fish by teasing higher prices from overseas buyers whom the company supplied with up to 20,000 pounds of fillet per week for a maximum of 1.04 million pounds per year.

They were not as accommodating as local supermarkets and food establishments.

Broilers had primed shareholders to expect problems with its fresh export fish, saying in a statement to the fourth quarter earnings report by chairman R Danny Williams and president Robert Levy in May that higher feed prices and a refusal by big buyers to pay more for the product was challenging the business.

The $250 million of revenue lost represents a half of total fish earnings, but as to the effect on the bottom line, Parsardsays exiting export fish would likely boost group profits.

Broilers, he said, expects a "positive bottom line impact of $35 million as a result of eliminating this loss."

Only loss-making business

Fish is Broilers' only loss-making business, haemorrhaging a combined $200 million in the last three years.

But the company says it has no plans to fully exit fish - which last year grossed just over $500 million or two per cent of group sales but made a $79 million loss on operations - and would refocus attention on the domestic market.

Some 80 jobs have been affected by the retrenchment, either through cuts or reduced responsibility, and while Parsard sidestepped comment on the level of capital investment that went into export fish, he told the Financial Gleaner that the equipment would be employed in other areas of the group, including chicken and beef processing.

The company's financials show, however, that investment in the entire fish operation was stepped up in 2006 and 2007, when a combined $89 million of capital went into the business, two-thirds of which was spent in the period ending May 3, 2008. Prior to that investments in fish have stayed below $20 million per year.

Jamaica Broilers is largely a poultry producer, but its businesses cover fish, beef, feed and farm supplies, prepared foods, and more recently ethanol which, though less than a year old, seems set to rival poultry as chief money maker.

Net profit

The company made $740 million of net profit at year end May 2008 on revenues of $20.4 billion and net assets of $5.9 billion.

Its pull back from the domestic market about three years ago to concentrate on exports had dealt a blow to local food service companies that had come to rely on the St Catherine-based operation.

The company now plans to do as much as 1.25 million kilogrammes (2.75 million pounds) of fillet for the domestic market annually, and going forward is projecting profit of $15 million to $30 million from fish, according to Parsard.

Asked whether the pull out from overseas markets was an admission by the company that it had made a bad bet, Parsard, a JB board member since March 2007, skirted around a direct answer.

"JB has demonstrated its ability to adapt and change to the environment whenever necessary, particularly the more recent past," he said.

"We have always been the largest player in the local farm raised fish segment and will continue as such given the correct market dynamics."

Lavern Clarke
Jamaica Gleaner

Thursday, July 24, 2008

Banks boss Cozier gets FCGA Award

Published: Thursday July 24, 2008

CEO OF BEVERAGE GROUP Banks Holdings Limited (BHL), Richard Cozier, has been given the illustrious Certified General Accountants Fellowship (FCGA) Award for 2007.

He joins 28 other recipients from Canada, China and the Caribbean.

The FCGA award is presented to certified general accountants who have provided exemplary service to the association, the profession, or the public.

A CGA member since 1987, Cozier described the award as an honour.

"I was very surprised when I learnt that I had been nominated, and actually receiving this award was even more unexpected. It is a wonderful feeling to be recognised by your peers," he said.

The BHL CEO was nominated by fellow CGA members and the nomination submitted by CGA Barbados to CGA Canada for consideration.

The CGA's Honours and Awards Committee then met and presented its recommendations to the CGA board of directors which made the final decision.

Other Caribbean recipients include fellow Barbadians Marcel Murrell and Annette Weekes, Grenada's Majorie Lander, and Reuben John of St Vincent.

Cozier was presented with the FCGA award recently at the local CGA Association's graduation ceremony at Hilton Barbados.

Source: Nation Newspapers

Euromoney names RBTT Best Bank

Published: Thursday July 24, 2008

Global financial magazine, Euromoney, named RBTT Bank Limited Best Bank in Trinidad and Tobago at its 2008 Awards for Excellence, in London on July 10. These awards define banking excellence in global categories, across 110 countries and are based on outstanding performance, quality service and innovation.

"This award is evidence of RBTT's strength and speaks to our staff's passion and commitment to excellence, and always putting the customer first," said Managing Director RBTT Bank, Catherine Kumar.

The award follows the amalgamation of RBTT and RBC which positions the bank to become the premier provider of financial services in the Caribbean. It is the third award from an international magazine in the past year-LatinFinance named RBTT Bank "Bank of the Year - Trinidad & Tobago" and The Banker ranked RBTT number one in Trinidad & Tobago on its list of Top 1000 World Banks.

Euromoney is a monthly publication which features key developments and players that influence the financial industry. The 2008 Awards for Excellence will be featured in the magazine's July issue.

Source: Trinidad Express Newspapers

Wednesday, July 23, 2008

Companies moving towards strategic corporate social responsibility

Published: Monday July 23, 2008

As businesses become more aware of the interdependency between themselves and their surrounding environment, local companies are moving towards strategic corporate social responsibility, a Jamaica Employers Federation (JEF) survey has revealed.

The JEF survey, conducted between July and September 2007 on 240 companies - highlights that while areas of priority varied from entity to entity - all were seeking out opportunities to make social contributions.

"Corporate social responsibility is really beginning to be an important aspect of how companies do business in Jamaica," said Bridgette Levy, a consultant who was apart of a JEF commissioned team that conducted the survey.

Levy, who was presenting the contents of the survey at the Knutsford Court Hotel yesterday, added that the survey found that as companies grow and increase their profitability, more priority is made towards philanthropy.

The survey revealed that 50 per cent of companies make contributions towards education initiatives - 40 per cent on health education alone - while 81 per cent spend on community.

Other areas of focus were:

. Policy development, 20 per cent

. Child and human rights issues, 40 per cent

. Culture and arts, 28 per cent

. Disaster relief, 53 per cent

. Staff training, 75 per cent

. Health benefits, 70 per cent

. Product safety, 61 per cent

. and less than 20 per cent considered greenhouse gas admissions.

"Each company operationalises it differently but all were doing something within the key areas," noted Levy. "Every company wanted to ensure that they do everything in their power to make sure that the environment is safe and protected, and staff is very well taken care of."

The survey captured a wide range of Jamaican businesses in terms of age, size and profitability. Of the companies surveyed, 70 per cent were in business for over 10 years; 25 per cent had over 250 employees; 46 per cent had between six and 50 employees; 29 per cent had less than six employees; 10 per cent had revenues over $500 million and 25 per cent had revenues of $20 million or less.

The majority of the mainly private businesses were service providers, while the other categories were comprised of manufacturers, construction, transport and trading companies.

JEF president, Audrey Hinchcliffe, said that Jamaican businesses have gone for too long unrecognised for their contribution towards national development. She said that the results of the survey is indicative of employers' "immeasurable" activities.

"The colossal impact that the practice of corporate social responsibility has on a nation is immeasurable," said Hinchcliffe. "Essentially it epitomises the voluntary and kind actions of employers to their employees, the community and the environment."

Guest speaker, Ronnie Goldberg, International Organization of Employers (IOE) regional vice-president, encouraged Jamaican businesses to continue excecuting voluntary principles, and said that flexibility and innovation in activities will ensure effectiveness.

"Companies, individually or jointly with other stakeholders, must continue to develop additional corporate responsibility initiatives to address the evolving social expectations in business requirement," she said.

Source: Jamaica Observer

Go public, says Mayberry chief

Published: Wednesday July 23, 2008

MANDEVILLE, Manchester - Gary Peart, CEO of Mayberry Investments, says foreign companies are acquiring and capitalising on the success of local brands because some owners of Jamaican companies are incapable of taking their entities into the global market.

The answer, he suggests, is for local owners to sell shares publicly in order to raise capital while at the same time facilitating the retention of Jamaican ownership.

Peart alluded to several companies he described as those that 'come up lacking', all of which were established in Jamaica but are now under foreign ownership.

"The first job in creating a viable business is having a marketable idea and Jamaica does not lack this capability," Peart said. "The sought after world brands of spirits that we have built.Tia Maria, Red Stripe, Captain Morgan Black Label Rum and Appleton have all been taken to the doorstep of entry into the global market and we have come up lacking in the resources to take them further. As a result others have picked up opportunities we have created," he added.

Peart's remarks, which came during his address to the Manchester Chamber of Commerce (MCoC) monthly meeting held at the Golf View Hotel in Mandeville last Thursday night, were made in the context of a transaction that will see the acquisition of Lascelles - which owns Wray and Nephew - by Trinidad and Tobago's Angostura. The deal, he says, will be finalised on July 28.

Peart outlined ways in which the trend of selling some of Jamaica's finest assets may be counteracted.

"One way to offset this is to encourage the emergence of more people who are prepared to take companies public," Peart said. "Going public gives your company an immediate, objective measure of one aspect of its value that is the price that investors will pay for your shares. When you multiply this price times the number of shares you have issued you get your company's market capitalisation, so the larger the number of people who own your stock, the larger your market capitalisation is likely to be," he explained further.

Source: Jamaica Observer

Jamaica producers - the energetic option

Published: Wednesday July 23, 2008

When we think of Jamaica Producers Group (JP), bananas are the first things that come to mind. For most, the two go hand in hand. This association has negative implications for JP somewhat, as the banana industry has been struggling in the past few years. Not only was the termination of Jamaica's preferential trade agreement with Europe a major blow, but Hurricane Dean, which wiped out JP's crops, added fuel to the fire.

However, what people tend to overlook is that there is much more to JP than bananas. Besides JP Farms, which owns two of Jamaica's largest banana farms, JP is also the parent company of JP Foods, the co millionercial food segment which sells both processed and fresh produce. JP Shipping, which also falls under the JP umbrella, has four state of the art reefer vessels providing a weekly service to Jamaica, the UK, Continental Europe, Costa Rica, and the Dominican Republic. Sunjuice (parent to Serious Food Company), which is currently carrying the torch for JP, is the UK's market leader in the short shelf life juice and smoothies market.

JP has ensured that it doesn't stop there. For 2008, the Company's goal is to expand and focus on the profitable sectors of the business and wipe out the areas that are operating at a loss. Its fresh juice and smoothie business, which is booming in Europe, is on the top of its priority list. As this is proving to be the most successful sector in the Group, JP has decided to make it its core business.

JP recently bought Holland's leading fresh juice and smoothie manufacturer, Hoogesteger Fresh Specialists BV for EUR 9.2 million (J$950 million) which brings in 130 employees and annual revenues of approximately EUR 32 million (J$3.67B using an indicative rate of J$114.82: EUR 1.00). This is projected to increase JP's net margin by 5-10 per cent. For now, Hoogesteger will operate as a separate business unit, but in 2009, the plan is to join forces with Serious Food Company in the UK with the intention of becoming Europe's largest and best fresh fruit juice and smoothie provider. In the mean time, Hoogesteger will draw on management support and expertise from the UK.

After the acquisition, JP did not waste any time. The Company quickly ditched its dessert subsidiary Serious Desserts, which was bringing in less than three per cent of the Group's revenue. Serious Desserts was sold to Nobile Foods Ltd in a deal valued at J$400 million. This is in line with the JP's plan to divest certain non-core business to give the juice and smoothie business the attention that it warrants.

These strategic moves are a clear indication of JP's resilience and innovation. Though a number of uncontrollable factors were a setback for the Company, particularly escalating energy costs and extreme weather conditions, JP has not buckled over.

Apart from the acquisition and sale, JP has a number of other initiatives on its plate. It has put new senior management in place, and implemented cutting edge technology to streamline the measurement of banana quality. The novel software gathers information on the ageing process of the bananas and the quality in bagging on the plants. Also, JP strategically decided to relocate its snack manufacturing factory to Dominican Republic to take advantage of cheaper fuel and electricity costs. It is also pursuing Fair Trade Certification (FTC) in the UK that will certify that JP is an ethical banana producer. With FTC, the bananas will receive a fair price premium which is expected to boost revenues by 11-12 per cent.

There is no denying that JP is on a roll. It certainly has not let the effects of Hurricane Dean and rough quarters hold it down. If anything, it has fuelled JP's energy and determination to expand. Though EPS is currently not strong, the Company is on the right track, with its acquisitions and European growth outside of the UK. Whether or not buyout speculation is still in the air, this is definitely a stock that investors should not overlook and pick up at levels below J$35.00. Let's not forget JP's GraceKennedy shares, and its Book Value per Share which stands at J$48.75. The stock is trading at 0.72 times book value and is a very good long term BUY. Lascelles, which was also a long term BUY is a great example of a Company that turned itself around - we can put JP in the same

Source: Jamaica Observer

Who will replace Bill Clarke?

Published: Wednesday July 23, 2008

RBTT managing director Mina Israel is investors' top pick to replace outgoing Scotiabank president Bill Clarke.

Her heart is with Scotia, they say, but if she cannot be wooed, then a Canadian is expected to head the operations. A third possibility is banker Aubyn Hill, who headed National Commercial Bank - Scotia's major rival - four years ago. The Business Observer contacted over a dozen brokerage houses but investors mostly declined comment. The only constant was that one expects the bank's second tier to lead.

"I think they will try to recruit talent from the local market such as Minna Israel or Aubyn Hill," said Michael Parker head of investments at Guardian Asset Management - whose parent company manages the 8th largest block of Scotia shares - 13.5 million units. "Either one would be a suitable candidate."

When Israel was at Scotia she was its leader-in-waiting. Her departure left a void at the bank which has not been filled. As such financial analyst John Jackson feels that the group will initially put a short-term president from the Canadian parent.

"I don't expect them to go outside the group. I think a Canadian will head the bank at least for two or three years on a temporary basis before a local [replacement] is put in place", says John Jackson, financial analyst. Yesterday the Canadian operations did not return calls, nor did the local operations, to say when a replacement would be announced.

"Israel, I don't know if that is going to happen anytime soon," he said alluding to her obligations at RBTT, which might preclude corporate hop-scotching.

"If Minna Israel was there it would be her; she will probably go back, back again it depends on her contract," said Stocks & Securities Ltd managing director Clinton Brooks.

Brooks added that Aubyn Hill would also be a candidate. "Because they have a similar management style," he said.

Clarke, who headed the bank since 1995, was charged with infusing the operations with highly qualified and educated management; even as he was from the old guard. He restructured management and cut jobs in the process.

"He was the axe-man put in place by Canada. And he executed the orders from Canada ruthlessly, except when it came to his departure," said a source close to the bank.

Clarke announced his retirement last Friday, and that his final day would be in October. But the investment community widely feels he was fired.

The bank in Friday's press release countered: "The board refutes any allegations that Mr Clarke has been separated from the bank."

But the bank gave no reason why Clarke would have decided to retire at this time, given his successful tenure as head of the island's top commercial bank. More so the absence of a clearly identified successor fuels the view that Clarke was fired.

Investors are not concerned that Clarke's departure will lead to a fall-off of the bank's performance. Last financial year, Scotia made a net profit of $7.6 billion, a 12 per cent increase over the previous year.

"It is like a ship, the captain does not have to be in the front always, but if there is an iceberg he is there to navigate around it," said Jackson. "In many respects Canada dictates the major thrust of the organisation. ... I don't expect any major deviation from operations."

Jackson's view was supported by the Scotiabank Jamaica's sixth largest shareholder, the National Insurance Fund (NIF), which holds 26.5 millon shares. The NIF fund manager says that Canada will ensure that Clarke's departure will not negatively affect the bank's operations.

"I am sure that they would have been doing succession planning and if they cannot find someone locally, they can always pool persons from aboard". said Audrey Deer Williams. "Minna Israel has been gone for a while, so I think they would have done what they needed to do by now."

Regardless of optimism, Scotiabank's slogan, "you're safe with us", will more than ever be put to the test.

Source: Jamaica Observer

Caribbean sugar production falters - Volumes, exports down in current year

Published: Wednesday July 23, 2008

Caribbean sugar factories have produced and exported less sugar so far this crop year than the prior season, a portion of which is due to Trinidad and Tobago's total exit from the market.

The Sugar Association of the Caribbean (SAC) said in its May report on production figures that operations began slowing down ahead of the close of the current crop.

The season should wrap up by the end of June, but could extend into July, and regional factories would have to grind another 102,000 tonnes to meet performance targets of 600,000 tonnes.

The four producing countries remaining in the SAC group have churned out 497,721 tonnes of sugar between July 2007 and May 2008, an eleven per cent drop in volumes from 558,792 tonnes, year on year, while exports were off by 12 per cent.

Trinidad in the May 2006-July 2007 period contributed 25,252 tonnes of sugar to Caribbean volumes, but its absence from the market this crop season only accounts for 41 per cent of the decline in production, suggesting that the other players had lower crop yields.

Persistent rain

"As has been the case for some time, persistent rain has adversely affected production of sugar in Guyana, Belize and Jamaica, but we are hoping that it will be helpful to growing cane for the next crop, says Karl James, chairman of the Sugar Association of the Caribbean in a release on crop performance.

"The industry is also facing a very challenging year with Trinidad not producing this year, so at the present rate of production, and given the report on the adverse weather conditions, the final out turn for this crop could be much less than originally forecasted."

Jamaica records biggest drop

Indeed, SAC figures indicate that the remaining four SAC countries - Guyana, Jamaica, Belize and Barbados - all produced less sugar this season, with Jamaica having the biggest drop in volumes of about 21,000 tonnes, down to 126,650 for the crop year to date. Belize's production was down by almost 10,000 tonnes to 73,341 tonnes; Barbados was off by more than 2,000 tonnes, and Guyana by over 2,800.

The SAC countries sold 391,519 tonnes of sugar to Europe and other export markets to date this season, compared to 444,018 tonnes in the similar period of the 2006/07 crop year, with Jamaica and Trinidad largely accounting for the dampened external sales.

Exports to Europe - which accounts for just under 90 per cent of the Caribbean sugar market - amounted to 349,949 tonnes for the crop year to May, earning approximately €496.8 per tonne.

Earnings are booked in US dollars, and so, alongside the preferential price, the countries benefit from foreign exchange conversion gains as the dollar slides against the euro. One euro is now the equivalent of US$1.59.

"The weakness of the dollar against the euro has adequately compensated for the price reduction," said the association, referring to the latest of the phased price cuts in protocol sugar being implemented by the EU.

The first was a 36 per cent cut in 2006, while another 5.1 per cent reduction took effect July 1, according to the SAC, which pushes the price down to €471.46.

Last year, Jamaica shipped 109,350 tonnes of the commodity overseas, but this season its exportvolumes are down to 99,000 tonnes, while Trinidad's is down to 843 tonnes sold only to Caricom, compared to the 22,615 tonnes the twin-island republic sold regionally and externally.

Jamaica's sugar industry is also to undergo a transformation that will see less reliance on the business of raw sugar, and consequently reduced exports, and more reliance on ethanol and other value-added products under Infinity BioEnergy/NewCo, the Brazilian company that has acquired 75 per cent control of state owned sugar assets.

Source: Jamaica Gleaner

Region to fight erosion of trade preferences

Published: Wednesday July 23, 2008

As World Trade Organi-zation (WTO) talks began in Geneva on Monday, the Caribbean made it clear that it would not throw open its doors to free trade simply for the sake of liberalisation.

Director General of the Caribbean Regional Negotiating Machinery (CRNM), Henry Gill, told the Caribbean Media Corporation (CMC) that the region was seriously worried about attempts by Latin America and other WTO interests to rapidly reduce its traditional trade preferences.

Negative effect

"This can have, for economies that have been weaned on preferences, a negative effect, depending on what the nature of the deal is," he said.

"That is why we are being so careful about the issue of preference erosion."

Gill has also rejected suggestions that the WTO talks are doomed, saying that he was anxious for an agreement, particularly in the area of agriculture.

"One of the arguments that has been used is that we are in this situation, with regards to food prices globally, simply because there were blockages to international trade in agriculture.

"So, to unblock all of that, the expectation is that if we could have a successful round, particularly in terms of agricultural liberalisation, this could help the global economy, including our own consumers, but we have to be careful in the middle of that in terms of how this liberalisation is negotiated and eventually effected," he said, adding that countries were working towards an outcome that is balanced between agriculture and other issues.

The CRNM head told CMC that despite the concerns, small, vulnerable countries like those in the Caribbean were also seeing some positive developments and he was hopeful of further progress.

"I think it is important to give an indication that the small and vulnerable economies (SVEs) have come a long way and there is broad recognition of a range of our interests and they have been taken account of, so that is the optimistic note," he said.

Positive disposition

"I don't think anybody has a crystal ball so you can't tell how this one-week process is going to turn out, but the important thing to underline is that there is a positive disposition to move ahead."

Addressing the WTO mini-ministerial meeting, Barbados' Foreign Affairs Minister Christopher Sinckler stressed the need for a development dimension to the ongoing global trade talks.

Sinckler was supported in his call by the Guyanese Trade Minister, Henry Jeffrey, who was also invited to the exclusive WTO Green Room for private discussions.

Jamaica and Suriname were also represented at the talks which have been in progress for the past seven years.

Source: Jamaica Gleaner

CL Financial creates holding company for Lascelles shares

Published: Wednesday July 23, 2008

Lawrence Duprey's CL Financial Group has created a special purpose vehicle as holding company for its new acquisition Lascelles deMercado, bought through its spirits subsidiary Angostura Limited.

CL Spirits Limited, which is 100 per cent owned by CL Financial, was created two months ago, said Michael Carballo, for the sole purpose of holding the Lascelles shares that were offered up to the Trinidad company under its US$9.25 per share acquisition bid.

Final tranche

Angostura will pay the second and final tranche of US$4.75 per share on July 28, after which the acquired holdings, which are now held in escrow by Citibank NA in Kingston would be transferred to CL Spirits.

CL Financial has said it would have at least an 86 per cent share in Lascelles when the deal is finalised.

Carballo said Tuesday that no decision had been made yet as to whether CL Spirits would be the vehicle for the planned listing of the amalgamated spirits businesses of Angostura and Lascelles.

"That has not been worked out as yet," he said.

The Jamaican conglomerate is in the business of spirits, merchandising, passenger and cargo handling, insurance and automotives, but it was primarily its ownership of rum company Wray and Nephew Limited, and secondarily, Globe Insurance Company that attracted Duprey and made it a takeover target.

The new CL Spirits Limited has a three-member board, said Carballo: Duprey as chairman, and Carballo and CL Financial's Joffrey Leid as directors.

Duprey already has a seat on the Lascelles board, but the board's composition is expected to change once the deal goes through at the end of the month.

Profitable operations

Its composition, Carballo has said, is to be decided. Duprey, however, is expected to assume the chair eventually.

William McConnell will rem-ain as group managing director of the company, which is one of Jamaica's most profitable operations with more than $2 billion of net income in each of the last two years.

Source: Jamaica Gleaner

Sandals, C&WJamaica ink $500m deal

Published: Wednesday July 23, 2008

Cable and Wireless Jamaica (C&WJ) has secured a three-year contract with Butch Stewart's Sandals Resort International (SRI) as primary provider of data transport and mobile services to the hotel group.

The new arrangement covers Sandals 17 properties spread throughout the region, and is valued at US$7 million (J$505 million), the companies announced Tuesday.

It's the second major contract for the Phil Green-led C&WJ in six weeks, and even more lucrative than the $400 million job that the telecoms, in partnership with Avaya, secured from Scotiabank Jamaica to upgrade its telephone systems.

Under the Sandals deal, C&WJ will provide the hotel company with 'bandwidth-on-demand' service that links into its core network.


The system will allow connectivity between Sandals' resorts in Jamaica and the region and its marketing representatives in the United States, while reducing the hotel group's telecommunications and call charges.

"As our group expands, it is critical that we upgrade to the most efficient, innovative telecoms system available," said SRI Chief Executive Officer Adam Stewart in the joint statement announcing the deal.

"Cable and Wireless provided us with the cutting-edge technology needed and a comprehensive package of services, and we are pleased to choose them as our primary providers going forward," regarding the agreement.

Stewart, who is Butch's son and his heir apparent, said that Sandals to now has used a variety of service providers to satisfy its mobile, Voice Over Internet Protocol (VOIP), fixed phone line and Internet service needs.

New business model

Green, who took over the management of C&WJ in August 2007, and has operational oversight of the British telecoms' regional business, is in the process of building out a new business model that positions the telecoms as a pan-Caribbean operation - one that retains its national operations but is centrally controlled by a corporate body.

Jamaica remains the largest of the regional operations but is currently weighed down by $2 billion of losses that Green is attempting to shake off through new products and deals like those just cobbled with Scotiabank and Sandals.

Indeed Green, who replaced Rodney Davis as CEO, was sent in by London to fix Jamaica, and having done some housecleaning in the last 10 months, is adding spit and polish through revised products and business contracts.

C&WJ will provide Sandals with a regional mobile closed user group service to allow unlimited calling across the Caribbean at one flat rate. The telecom provider will also introduce its Multi-Protocol Label Switching Technology (MPLS) to enhance connectivity for the hotel chain.

Sandals also gets a 24-hour monitored service and customer premises equipment (CPE) provided and managed by C&WJ.

C&WJ says it will roll out its MetroNet Service to the 17 Sandals properties across the region while MPLS will be deployed to Sandals in Antigua, St Lucia, and Jamaica and Beaches in Turks and Caicos.

MPLS allows for the management of network traffic, while MetroNet delivers ethernet connectivity between sites, enabling Local Area Network (LANs) to connect seamlessly.

The system's installation should be complete in four months.

Sandals will be billed monthly, allowing "the flexibility to pay as services are used," said

Rachel McLarty, Sandalsgroup director of corporate communications.

Susan Gordon
Jamaica Gleaner

GraceKennedy creating $2b distribution hub

Published: Wednesday July 23, 2008

GraceKennedy Limited, the big Jamaican conglomerate, is constructing a J$2-billion facility off the Spanish Town bypass in St Catherine that will bring a large segment of its food distribution and cold storage into a single complex, senior officials confirmed.

The distribution hub, being built by contractor Frederick Moe and financed from internal resources, is to be completed by October 2009.

"Yes, we are going to be building a distribution centre which will incorporate some cold and chill storage," GK Foods Chief Executive Officer, Erwin Burton, confirmed to Wednesday Business last week.

Greater efficiency

This facility will apparently allow GraceKennedy to consolidate a number of warehouses, thereby providing for greater efficiency through economies of scale. It is also likely to enhance inventory management.

Burton said the facility will be a state-of-the art distribution centre that will operate as a distribution point for all of GraceKennedy's food brands and would incorporate group subsidiaries such as Grace Foods International (GFI), Grace Foods and Services (GFS), World Brand Services and Hi-Lo warehousing.

Sources say Moe, the contractor hired by GraceKennedy, began construction on a $400-million building at the complex less than three weeks ago.


The $2-billion centre is substantial even for GraceKennedy, which last year reported making capital investment of $700 million - its second-largest spend on projects in five years - of which about a quarter of a billion dollars was pumped into plant and equipment that fall within GK Foods' portfolio.

But with more than $8 billion of cash to play with, the conglomerate, whose sales last year topped $48 billion for a new record, can more than afford to financethe distribution centre from internal resources, as Burton said it would.

The facility, though not expected to be operational for one and a half to two years, seems to complement plans by GraceKennedy to position itself, by year 2020, as a 'global consumer group' that builds value on customer service, brand loyalty, and an "aggressive" push for new markets, both organically through new product development as well as the acquisition of businesses.

Jamaica, the United States, United Kingdom, Canada and Belize are GK Foods' chief markets.

But its products are sold in several other countries, which now include India, where GK Foods announced it gained a toehold last October through exports of Grace Coconut Water.

The plan for the distribution centre comes at a time when the company is adding new products, and on the heels of sales growth in various markets last year, including but not confined to Antigua, up 20 per cent; Guyana, 23 per cent, Bahamas 33 per cent and Trinidad where sales more than doubled.


Currently, GraceKennedy's warehouses are at different locations in the Kingston industrial zone: GFI is at Newport West; GFS warehouse is at another location downtown Kingston and its World Brand warehouse is on Spanish Town Road.

Wednesday Business understands that Hi-Lo, which is said to have the No 3 spot in the grocery market behind Super Plus and the Progressive consortium, no longer has a central warehouse and that each of the supermarket outlets sources its own goods.

Susan Gordon and Janet Silvera
Jamaica Gleaner

Monday, July 21, 2008

Regional leaders face hurdles in push for economic union

Published: Monday July 21, 2008

Many rivers to cross....

But I can't seem to find my way over

THE WORDS of the Jimmy Cliff's song aptly describe the problems facing regional leaders as they push to meet the 2015 schedule for an economic union.

This should involve the harmonisation of monetary and fiscal policies in the 12 regional states which have signed on to the Caribbean Single Market and Economy (CSME).

But, in a region where political parties in individual countries often cannot agree on monetary and fiscal policies, some are finding it difficult to see how 12 states with 11 million people will agree on issues such as fiscal deficit, debt levels and interest rates.

Fundamental decisions

These are issues the CSME secretariat accepts will be difficult to address, but the body remains upbeat that, once there is the political will, the single economy will be in place on schedule.

"The road to monetary integration is going to be difficult for the simple reason that it will require what I would describe as fundamental decisions and, more importantly, the creation of a monetary integration treaty," said programme manager of the CSME secretariat, Ivor Carryl.

But Carryl is confident there is enough time to have this done to meet the 2015 deadline. He is supported by macro economist at the CSME Secretariat Lennox Forte.

"Apart from the obvious political will that is required, there has been significant work that has already taken place," Forte said.

Established bodies

According to Forte, the Organisation of Eastern Caribbean States (OECS) provides an example that a single economy is a workable proposition. He said the region has already established bodies to ensure that the process works.

"There is the Council of Finance and Planning which is the body responsible for fiscal issues and the Committee of Central Bank Governors which is responsible for monetary policies, so the facilities for collaboration and coordination of policies already exist," Forte said.

But Forte accepts that there has to be an increase in inter-regional trade to provide the market stimulus for an economic union which could result in a single currency replacing the currencies used across the Caribbean. That proposal for a single currency is one of the major rivers that will have to be crossed in the rush towards a single economy.

This could mean that the Jamaican dollar and other individual currencies would be abandoned. For Forte, this would be the best method. However, he is not prepared to allow that to be a sticking point.

"We can have a situation where we have multiple currencies; it has happened before in the history of the West Indies. The key to it is that the exchange rate between the currencies must be transparent," Forte argued.

He rejected claims that the single economy cannot work without a political union, pointing to the European Union.

According to Forte there could be the establishment of a group of commissioners to monitor the single economy.

Arthur Hall
Jamaica Gleaner

'Jamaica to gain billions from European tourism'

Published: Monday July 21, 2008

Tourism Minister Edmund Bartlett says Jamaica's continued penetration of the European tourism market is expected to earn the nation some US$7.5 billion over the next 10 years.

Bartlett said on the weekend that, between now and 2018, the country is expected to welcome more than five million stopover visitors from Europe.

He made the disclosure on Saturday while speaking at the official opening of Jamaica's newest attraction, Rainforest Bobsled Jamaica at Mystic Mountain in Ocho Rios, St Ann.

Ready to reap benefits

Bartlett said Jamaica was fully aware of the changing persona of today's travellers, has successfully gone ahead in shaping its tourism product to surpass those expectations and is now ready to reap the benefits.

Bartlett said Mystic Mountain would play a critical part in realising the vision of the new tourism in Jamaica and that the stellar attraction illustrates the importance of staying ahead of the market.

"So today marks an important milestone with the opening of Mystic Mountain which is expected to add by veracity to Jamaica's eco-friendly attractions," he said.

The tourism minister described Mystic Mountain as an innovative way of showcasing Jamaica's natural beauty and an extraordinary setting for special events that would become an important part of the tourism product.

He said the establishment of the attraction was also a superb example of the private sector contribution to the overall development of Jamaica's tourism product.

Source: Jamaica Gleaner Newspapers

New trading rule to promote liquidity

Published: Monday July 21, 2008

THE BARBADOS STOCK EXCHANGE (BSE) is about to implement a price stabilisation rule to govern stock trading in an effort to promote liquidity in the capital market.

BSE general manage Marlon Yarde told BARBADOS BUSINESS AUTHORITY that the rule could be implemented as early as next month and was also meant "to ensure that the true market prices are reflected in our shares".

The price stabilisation rule would "replace the previous notice regarding price movement of stock and facilitate conformance with international best practice, ensure the efficient operation of the market and further promote the integrity of the capital market," the Securities Commission said in a notice last year soliciting comments on the new rule.

The new price regulation states, "The general manager or in his absence the operations manager of the exchange may halt trading in a security for a period of not more than two hours if the offer price or the bid price rises or falls more than ten per cent above or below the closing price of the previous day's trading without apparent reason.

"A trading halt will only occur once in a trading session for any one security."

Yarde pointed out that the Securities Commission had already granted approval to institute the rule, which would be activated once the BSE had tweaked internal processes and apprised brokers of how it will work.

"The whole idea behind the price stabilisation rule is to let market forces dictate how the prices of shares move on our board. [And] one of the objectives is to improve liquidity in the market," he said.

He noted, "There is still that ten per cent upper limit, but once it hits that ten per cent, we will halt trading so that the market is aware that the share price is moving above the ten per cent limit.

"And this would give brokers in the marketplace an opportunity to advise their clients, 'This share price is moving up or moving down by more than ten per cent; what are your instructions on buying or selling this particular security'."

Source: Nation Newspapers

BS&T, Cave Shepherd in share swap

Published: Monday July 21, 2008

BARBADOS SHIPPING & TRADING COMPANY LIMITED (BS&T) has acquired Cave Shepherd & Company Limited's five per cent stake in United Insurance, while Cave Shepherd has acquired BS&T's 25 per cent interest in Fortress Fund Managers Limited.

The effect of the transactions is that United Insurance becomes a wholly owned subsidiary of BS&T while Cave Shepherd's holding in Fortress increases from 37.5 per cent to 60 per cent, the remaining 2.5 per cent of shares being used to establish a share-participation scheme for Fortress staff.

Cave Shepherd has been associated with United Insurance since the company's formation, first as an agent. Later, its five per cent equity interest in United was created by incorporating Cave Shepherd's insurance agency business into United.

Similarly, BS&T was one of the founding shareholders of Fortress Fund Managers Ltd, an official statement said.

G. Anthony King, CEO of BS&T, and John Williams, CEO of Cave Shepherd, have both commented that these transactions allow BS&T and Cave Shepherd to more effectively and beneficially pursue their respective interests in these businesses, to which they each contribute substantial direction for business development and oversight.

Source: Nation Newspapers

Barbados to pay up for tourism marketing

Published: Monday July 21, 2008

BARBADOS MAY BE EXPECTED to contribute a significant share to the Caribbean Tourism Marketing Fund proposed by CARICOM Heads of Government for selling the region as a single tourist destination.

This is the indication from Luther Miller, director of finance at the Caribbean Tourism Organisation (CTO), who confirmed that Caribbean countries were better off marketing themselves in a cluster.

"It has been demonstrated over the years by going to major international travel trade shows, be it in London, Berlin, France or Milan, that given all the clutter in the world today in tourism marketing, the market responds better to the collective image of the Caribbean. . . ."

Two weeks ago, whilst introducing tourism in the 2008 Financial Statement and Budgetary Proposals, Prime Minister David Thompson noted that some major decisions were taken for the industry in the Caribbean at the recent Heads of Government meeting held in Antigua, "including the commitment to a regional brand".

And, according to Miller, Barbados should be prepared to make a hefty contribution to the US$60 million fund that would most likely be capitalised with each country's input according to their level of tourist arrivals.

"How much each country would be required to put up [would be determined by] the ratio of visitor arrivals as a percentage of the total arrivals for the region, so that the countries with the greatest tourist arrivals would make the greater contribution to the fund.

According to CTO statistics, Barbados ranked ninth among the 33 CTO member countries with 574 533 long-stay arrivals last year, and tenth with 616 354 cruise arrivals from January to December.

Miller said the fund's yearly financing was to come from the 33 CTO members.

Source: Nation Newspapers

Friday, July 18, 2008

Transport biggest contributor to June inflation - Prices climb 11.5 per cent in six months

Published: Friday July 18, 2008

The cost of living has risen substantially in the first half of the year with new data from the Statistical Institute showing inflation at 11.5 per cent, with prices rising faster in the capital than other towns and in the countryside.

The new data indicates that prices are growing at an annual rate of 23 per cent, or about two per cent per month. Fiscal inflation is at six per cent, or 24 per cent annualised, well ahead of the projected 14.5 per cent inflation that the central bank has forecast.

Last year, six-month calendar inflation was 5.1 per cent, an indication that prices in the current period are advancing at more than twice the pace than the comparative period a year ago.

For the month of June, inflation was a flat two per cent, largely pushed by transport costs, as well as higher gas prices, heavier utility bills, fuel and other costs generally associated with running a household.

In all divisions

"Increases were recorded in all the divisions during the month of June," said Statin, "with the exception of 'communications' and 'education' for which there were negligible movement."

Food prices, usually at the top of the list as a major driver of inflation, also grew in June, but not as fast as alcohol and tobacco, the household and transport categories, and even recreation.

Jamaica is currently paying about US$100 per barrel for oil from Venezuela, Prime Minister Golding said in Parliament Tuesday, but the price, though concessionary, moves in tandem with the performance of world oil which is trading around US$135 per barrel to US$147 per barrel.

In Jamaica, a litre of regular gasolene at the pumps crested $90 during the month at some stations, but was selling as low as $82 in the past week, while electricity bills have risen - mostly the fuel component - by about 14 per cent in this year, with the average household paying more than $4,000 per month for electricity consumption.

Adding up

Water rates were also increased by 28 per cent, adding to the cost of maintaining a household.

Food inflation for June hit 2.1 per cent, while at the top of the spectrum, the index for transport rose 2.9 per cent.

In the geographic regions, inflation in Kingston was 2.5 per cent, in other towns, 1.9 per cent, while in the rural areas, prices moved by 1.6 per cent.

Source: Jamaica Gleaner

RBC/RBTT aims for top bank in Caribbean

Published: Friday July 18, 2008

Royal Bank of Canada, enlarged by its acquisition of Port-of-Spain-based RBTT, is gunning to become the biggest bank in the English-speaking Caribbean, well ahead of the full merger of their operations over the next two to three years, RBC's regional bosses say.

With a combined asset base of US$13.6 billion, Royal/RBTT ranks behind Canadian compatriot, Bank of Nova Scotia - assets of US$16.1 billion - as the largest bank in the Commonwealth Caribbean and fourth in the wider region, up from 11.

Scotiabank is number three in the wider region.

But Royal's group CEO-designate, Suresh Sookoo, who has been a swing through the Caribbean with other RBC executives, speaking to shareholders and customers on the worth of the deal, doesn't expect that these rankings will stand for very long.

In fact, there is hope that the roles will reverse over the next year or so, assuming that there are no great asset gains by Scotiabank and RBC/RBTT can grow its assets over two-and-half billion or nearly 20 per cent.


RBC is paying US$2.2 billion, in cash and shares, for RBTT - a deal that is, in a sense, a return to the beginning. Indeed, RBTT started life as Royal Bank of Canada, Trinidad and Tobago subsidiary, which was spun-off in the 1980s when the Canadian bank was shedding its operations in a number of Caribbean markets, including Jamaica.

In Jamaica, the Royal Bank business was bought by the now defunct insurance company, Jamaica Mutual Life Assurance Company (Jamaica Mutual Life) and renamed Mutual Security Bank. When Jamaica Mutual later bought National Commercial Bank, Mutual Security was absorbed by NCB.

RBTT, on the other hand, spread out in the region, gaining a toe-hold in Jamaica when it bought a bank from the Government that was cobbled together from a number of distressed entities.

But even as the enlarged RBC, which will have 130 branches in 18 Caribbean markets, push hard to pump-up business, it will be 24 to 36 months before the integration of the Royal/RBTT operation is complete.

In fact, both institutions, officials say, will maintain separate shingles for at least another year-and-half, while they integrate technologies.


Apparently, RBTT, because it was driven to invest in this area to facilitate its expansion in the English-speaking Caribbean, has the more advanced technology.

"RBC didn't have the scale and size to do that network build out," said RBC's Executive Vice-President R.S. Pennycook.

Upgraded technology across the markets, including Jamaica, is crucial to RBC's planned expansion.

"We will be building out more ATM machines across the island," said Sookoo.

"Of the 480 machines island-wide, RBTT has only 34."

He expects that the number of ATMs in Jamaica to at least double, in short order.

The new Royal Bank also expects to aggressively expand its loan portfolio and the quality of its service in order to expand the business.

Susan Gordon
Jamaica Gleaner