Home' Trinidad and Tobago Guardian : May 20th 2014 Contents The Central Bank yesterday confirmed
a Sunday Business Guardian exclusive
story that the Government is planning to
dispose of Clico s traditional portfolio---
life insurance, health coverage and long-
term annuities---as part of the resolution
strategy for the financially strapped insur-
The Central Bank, in a statement signed
by Governor Jwala Rambarran, was respond-
ing to the story headlined "Howai: Clico
could go to foreign buyer...systemic risk for
In the statement, Rambarran said the
Central Bank was in control of Clico, pur-
suant to Section 44D of the Central Bank
Act and it was the only entity empowered
to restructure the business or undertakings
of Clico, in accordance with the provisions
of the act.
While section 44D gives the Central Bank
extensive powers to take control of com-
panies in which "the interests of depositors,
creditors, policyholders or members of an
institution are threatened," those powers
are subject to section 44F (5) of the Central
Bank Act, which states:
"In the performance of its functions and
in the exercise of its powers under section
44D, the bank shall comply with any general
or special directions of the Minister (of
Finance) and shall act only after due con-
sultation with the Minister."
Rambarran s statement said in order to
sell Clico "the Act requires the Central Bank
to have a market price for Clico s traditional
portfolio determined by an independent
valuation company. An independent actuarial
firm has, therefore, been engaged to value
Clico s traditional business for this purpose
and the exercise is still in progress."
The Sunday BG article quoted Howai as
stating that the firm conducting the actuarial
review of Clico is the New York-based pro-
fessional services firm, Towers & Watson.
The valuation exercise is expected to be
completed next month.
The Central Bank statement said after
the valuation was completed, "the Central
Bank will conduct the process for the sale
and transfer of Clico s traditional insurance
portfolio on a transparent, open market
basis. The bank has neither engaged with
any prospective buyers nor made any deci-
sion on the structure of the portfolio trans-
The Central Bank said it "remains com-
mitted to pursuing the resolution of Clico
in the interest of policyholders and creditors
in accordance with requirements of the law."
Clico collapsed in January 2009 as it was
pushed over the edge by the onset of the
global financial crisis and years of risky
deals, related party lending and dodgy cor-
As a result of the collapse of the insurance
company, taxpayers have pumped over $20
billion into Clico, its sister insurance com-
pany, British American, and a related non-
bank financial institution, Clico Investment
Bank, which was placed into compulsory
liquidation by the High Court in 2011.
Clico s most recent audited financial state-
ment for its 2012 financial year puts the
insurance company s insurance contract lia-
bilities at over $8 billion. Those liabilities
must be matched by assets.
The Central Bank said that as part of its
resolution strategy for Clico, it "proposes
to transfer Clico s traditional insurance port-
folio for value to an acquiring insurance
company that is well capitalised, has a
proven track record and the capacity to hon-
our all obligations to policyholders."
The Central Bank s three criteria for the
acquiring insurance company exclude an
issue raised by Howai, who in the Sunday
BG article said that the Central Bank had
advised him of concerns about the systemic
risk inherent in one of the large existing
local insurers acquiring all of Clico s tradi-
"There is a threshold that is used inter-
nationally of 40 per cent market share and
the Central Bank has signalled to us that
they would not want to see that 40 per cent
market share breached.
"Or that you come so close to the 40 per
cent threshold that the company that bought
it cannot write another dollar of business
because they would then be in breach of
the Act," Howai said.
The Finance Minister said that the Central
Bank had indicated to the ministry that it
thought the best approach may not be to
sell all of the portfolio to a single existing
buyer in the local market.
Howai said: "That could mean that an
international buyer could purchase all of
Clico or we could split the portfolio among
different (local) buyers. The reason for that
is that the Central Bank is concerned about
systemic risk."Union: Not informed of sale.
Minimum wage still to be reviewed --- McLeod News --- Page A6
POST YOUR VIEWS ON ANY OF TODAY'S STORIES @ WWW.GUARDIAN.CO.TT
President of the National Parent Teachers Asso-
ciation (NPTA) Zena Ramatali says Education Min-
ister Tim Gopeesingh is trying to use her as a
scapegoat to avoid addressing the issue of preg-
nancy in schools.
Speaking to the T&T Guardian yesterday, Ramatali
said the minister would not help addressing the real
issue facing the country s schools by assigning blame.
"The point here is not who reported whom, the
ministry is totally missing the mark on this. What
the NPTA is calling for is sex education to be taught
in schools," Ramatali said.
She was responding to an Education Ministry
release on Sunday which claimed that contrary to
her statements to the media, Ramatali did not report
the incidence of eight teenage pregnancies at a
school in south Trinidad to the ministry.
The ministry labelled Ramatali "grossly irrespon-
sible and negligent," adding she had "a duty to the
parents, students and by extension the public of
Yesterday, Ramatali fired back at the Education
Minister, saying she was not supposed to report
anything as this was the responsibility of the prin-
cipals and teachers at the school in question. Rather,
she said, it was the minister who was behaving irre-
sponsibly by not meeting with the stakeholders.
"The principal of the school reported the matter
to the Mon Repos police. How could the minister
not know that?" she asked.
She said the NPTA had been calling for meetings
with Gopeesingh since March 2013 but he had
refused to respond.
Ramatali said the minister could not continue to
ignore the fact that sex education was much needed
"Schoolchildren are having sex in the classrooms,
in the schools, under steps. They engage in oral
sex... and we would like that to be addressed and
not who didn t report it. There are many people
who do not report incidents that have taken place
in the school."
The pregnancies at the school were raised during
the T&T National Council of Parent Teachers Asso-
ciation s consultation on Saturday. Ramatali said
one of the girls was pregnant before she entered
the secondary system.
A source at the Mon Repos Police Station said
yesterday the station had no information on any
matters of that nature.
Tuesday, May 20, 2014 www.guardian.co.tt Guardian
Best buyer gets Clico
Head of the Clico branch of the
Banking, Insurance and General Workers
Union, Roxanne Cuffy, has disputed a
statement made by Howai in the Sunday
BG that the staff of the insurance
company has been advised that the
Government is considering the sale of
the traditional portfolio.
Cuffy described Howai's assertion that
the workers were advised as "completely
untrue and highlights a deeper concern
to the workers here at Clico."
She said five years have passed since
the collapse of Clico and the workers
there "are tired of being treated as non-
entities by the powers that be."
Cuffy said the Government "is taking
its cool time to make up their minds and
still failed to inform one of the major
stakeholders in this scenario, the
workers, of their plan," which will
significantly impact the life of every
"Imagine finding out about something
like this in the newspapers?" she asked.
for 19th MAY, 2014
Ministry missing mark
on school pregnancies
Workers in the dark
Links Archive May 19th 2014 May 21st 2014 Navigation Previous Page Next Page