Friday, September 26, 2008

No Wall Street exposure filings by Jamaican firms on stock exchange

Published: Friday September 26, 2008

No listed Jamaican company has told the Jamaica Stock Exchange it was exposed from fall-out in the US financial markets - a development which the market's general manager Marlene Street-Forrest says she is taking to mean that none of her members is materially affected by the Wall Street meltdown that has sent asset values plummeting.

"We assume that those who have not sent out emails have no exposure," Street-Forrest told the Financial Gleaner.

Obliged to disclose info

Under Jamaica Stock Exchange rules, listed companies are obliged to disclose information which comes to the attention of management that could significantly affect the firms' market price or value or materially affect their business.

"If the company has material exposure to anything, whether in our market or markets abroad, they need to expose it to the JSE," Street-Forrest said. "Appendix eight sets out this, whether it's a financial institution or a non-financial institution."

There has been some speculation here over the past fortnight of how the turbulence of Wall Street might have affected Jamaican brokerage houses.

Courted fund managers

The investment bank Lehman Brothers, which filed for bankruptcy protection and has been selling off assets, and Merrill Lynch, which put itself up for sale, were known in the past to have courted Jamaican fund managers.

However, Jamaican officials, in their early assessment, said that exposure by Jamaican financial institutions appeared to have been minimal.

Jamaica Money Market Brokers told shareholders at that firm's annual stockholders' meeting last week that it was exposed in Lehman Brothers for up to three per cent of the company's $85 billion own-account investment portfolio. But CEO Keith Duncan said he did not expect more than one per cent of that risk to be realised.

Own-account funds exposed

Dennis Cohen, the deputy managing director of National Commercial Bank, hinted that some own-account funds of its brokerage subsidiary - NCB Capital Markets - may have been exposed, but provided no figures.

Other financial firms either said they were not exposed or appeared coy in answers.

For Street-Forrest, she takes the absence of filings at face value.

"I would use the silence to assume no other listed company was in fact affected by the collapse in any material way," she said.

Susan Gordon
Jamaica Gleaner

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