Home' Trinidad and Tobago Guardian : November 21st 2013 Contents Suresh Sankaran:
Suresh Sankaran is a principal oper-
ations officer with the global IFC Risk
Management Advisory team, based in
Washington, DC, and provides technical
expertise to support regional projects
with financial institutions on risk man-
Before joining IFC in 2012, Sankaran
was the country head for Kamakura Cor-
poration, providing strategic consulting
services in financial risk management to
financial institutions in Europe, Middle
East, Asia, and Africa from 2002.
He specialises in credit risk, market
risk, liquidity, ALM, economic capital
allocation routines and integrated risk
frameworks. Projects worked on encom-
pass all facets of risk management across
the globe. Prior to this, he was with ABN
AMRO as regional risk manager, and with
HSBC as a regional MIS and risk man-
ager. He started his professional career
with KPMG in its risk consulting division.
A chartered accountant by profession,
Sankaran also has a Masters in mathe-
NOVEMBER 2013 • WEEK THREE www.guardian.co.tt BUSINESS GUARDIAN
NEWS | BG11
Guardian Holdings Ltd (GHL) is building up
its cash reserves as the regional insurance
group looks to position itself to take advantage
of higher interest rates in the future, according
to the group s chief executive officer Jeffrey
"Anticipating an eventual raising interest rate environment,
we have maintained an overweight in cash. While this has
hurt investment performance short term, we believe this is
a sound mid-term strategy that will allow us to take advantage
of future, higher-yielding assets," Mack said in e-mailed
responses to questions from the Business Guardian.
In the nine months to the end of September, GHL s after
tax profits declined by more than one-third from $302 million
in 2012 to $198 million as the group s investment income was
hit by losses as a result of the Jamaica National Debt Exchange
(NDX) and on the fair value of its investment instruments.
Giving an explanation about the loss, Mack said: "When
fair value and realised gains in 2012 are taken into account,
these items (the loss) represent the majority of the profit
decline from last year."
Chairman Arthur Lok Jack described the third quarter as
the "strongest" in 2013 for GHL. He said the company s insur-
ance business was the main contributor to boosting profits.
"Our core insurance operations realised good profits that
are up eight per cent year over year. In addition, gross premiums
written year-to-date amounted to $3.86 billion versus $3.37
billion over the comparable period, an increase of 15 per cent,"
Lok Jack said in the chairman s report.
The low interest rate environment proved challenging to
GHL as it affected its investment activities, Mack said via
"While our insurance activities have been strong, our invest-
ment activities have continued to lag prior periods due to the
continued low interest rate environment and a lack of good
investment opportunities. Anticipating an eventual raising
interest rate environment, we have maintained an overweight
Now that the amalgamation of Globe and West Indies
Alliance has been completed and the new entity, Guardian
General, Jamaica, has been established, the group described
the new company as "one of the largest commercial insurance
companies in Jamaica."
Commenting further on the amalgamation, Mack said: "We
are satisified with holding the number two spot in life insurance
and now the number one in general insurance. Overall, Jamaica
represents about 20 per cent of GHL s overall revenues and
we are comfortable with that level."
In April 2013, GHL received regulatory approval to purchase
Royal and Sun Alliance Antilles and has begun to make sig-
nificant steps in amalgamating both entities when it comes
to human resources and information technology.
"We will follow the same play book we used in the inte-
gration of West Indies Alliance/Globe and, again, we expect
to exceed our initial targets for achieving cost synergies."
Overall, in the general insurance market, competition is
"tough" in the motor vehicle business since "in some cases,
rates are falling below our technically acceptable levels." More
consolidations are expected in the T&T market and GHL is
"well-positioned to take advantage of these dynamics. The
Caribbean is our home market and we wish to continue to
"In our general insurance segment, our combined loss ratio
is providing the group with 20 per cent profit margin before
our investment results. This is due to our continued selective
underwriting approach as well as a lack of catastrophies."
Though liquidity continues to be a problem for investors
on the whole, GHL said it did not have an issue with liquidity
since all of its subsidiary companies maintain "an adequate
amount of liquidity to meet their various obligations and all
exceed their minimum regulatory capital requirements as well
as the group s requirements."
For the nine months ended September 30, 201, segmented
revenue showed its life, health and pension business generated
the highest profits for the group $213 million. The revenue is
broken down as follows:
Further commenting on the the third quarter results, Lok
Jack said it was a very solid quarter which was "driven by our
insurance underwriting and sales activities. We anticipate
enhanced results from our insurance activities as the investment
Now that GHL has rebranded, the group plans to continue
to build up recognition in the market and begin "to target our
specific business segments in future advertisements, such as
our life, health and pensions segment, our general insurance
segment and our asset management business.
In addition, we will continue to expand our corporate social
responsibility initiatives which centre around the them of a
healthy lifestyle and healthy choices."
Per capita, in the T&T market, "the amount of insurance
bought is still low. This underpins our belief that we still can
grown market share and premium by significant amounts."
GHL is targeting low double-digit growth in its earnings
per share if the investment climate remained where it is at
now and if the invesment climate improves its "growth esti-
mates" would, too.
Part of its mid- to long-term goals may include investing
in Central and South America.
With more than 13 years of experience in risk management
for financial institutions, Selaya leads the IFC s Access to
Finance Risk Management Advisory Services in LAC, pro-
viding technical expertise to support projects with financial
institutions in the LAC region (Guatemala, Nicaragua, El
Salvador, Honduras, Dominican Republic, Guyana, Belize,
Suriname, St Lucia, and Colombia).
He specialises in the areas of credit risk, assets and lia-
bilities, capital adequacy and financial modelling. Before
joining IFC in 2009, Selaya was the integrated risk manager
for a large corporate bank in Bolivia, and member of the
Risk/ BISA s Group ALCO Committees affiliated companies,
the largest financial group in the country.
Prior to this, he worked for five years in the Bolivian
financial services regulator, in the prudential regulations
department. He also has been consultant in risk management
and started his professional career with Pricewaterhouse-
Coopers, advising corporate clients in mergers and acqui-
sitions, valuation and strategic planning.
Selaya holds a bachelor of economics (Chile), a Masters
in corporate finance (Bolivia) and a diploma in risk man-
From Page 10
GHL building, waiting cash for higher rates
Life, health and pension 213
Property and casualty 143
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