Feb 26, 2009 News
… local branch insists that it is safe
The Barbados Nation has reported that a High Court judge has granted an ex-parte injunction to the Central Bank of Trinidad and Tobago (CBTT) and the Colonial Life Insurance Company Limited (CLICO) preventing the embattled conglomerate CL Financial from conducting any local or international business with its assets.
CL Financial Group finance director Michael Carballo said he was surprised at the move by the CBTT, according to the Barbados Nation.
“I can confirm that since the intervention by the Central Bank…CL Financial has not dealt with, or disposed of any assets held by CL Financial…”
The restraining order issued by Justice Gregory Delzin prevents CL Financial from dealing with, selling, pledging, assigning, mortgaging, charging, disposing, transferring, divesting, diminishing the value of all or any of the assets, howsoever held by or to the use of, and or vested in the defendant, wheresoever located, and howsoever described.
CL Financial is the parent company of CLICO Guyana.
Last week, Cabinet Secretary Dr Roger Luncheon said that the National Insurance Scheme had invested some $6 billion (US$30 million) in CLICO (Guyana) some three years ago.
The audited accounts of CLICO suggested that CLICO (Guyana) invested the majority of this money in CLICO (Bahamas) at a rate of nine per cent per annum. CLICO (Bahamas) then invested US$57 million in another company, CLICO Enterprise, which eventually paid CLICO (Bahamas) US$9.5 million in interest for 2007. For 2006 CLICO Enterprises paid US$8.3 million.
Two days ago CLICO (Bahamas) was liquidated. This means that monies invested in CLICO (Bahamas) may be lost to investors, including CLICO (Guyana).
CLICO Enterprise received the majority of its money from CLICO (Bahamas) — US$57 million — of which US$30 million came from CLICO (Guyana), and CLICO (Trinidad) US$45.4 million.
The company invested the US$57 million in a real estate, Wellington Preserve of Florida; Shabisco, a bakery in Haiti; and Grand Bahamas, a hardware store, lumberyard and building supplies.
In 2007, CLICO Enterprise lost US$25.2 million from the investment in Wellington Preserve.
The Trinidad Central Bank has already taken assets of CL Financial and the Barbados Government is moving to do the same.
Guyana is still to make any move against CLICO (Guyana). Finance Minister Dr Ashni Singh has said that he is in constant contact with the Trinidad-oriented company and he is assured that local investors are protected.
However, the collapse of the various CLICO entities in which the local company has invested raises questions, according to one local financial analyst.
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