– Berbice Bridge, Republic Bank, Banks DIH among the lot
In its ongoing efforts to liquidate the assets of Clico Life and General Insurance Company (South America) Limited, the liquidator has invited expressions of interests for the purchase of a number of securities that had been owned by the company before it was wound up.
According to the notice in the press, the shares available are: Banks DIH Limited – 16,242,720 common shares; Republic Bank Limited – 300,000 common shares; Berbice Bridge Company Inc – 80,000,000 common shares; Berbice Bridge Company Inc – Subordinate Loan Stock with a face value of $400,000,000 bearing an annual interest rate of 11 percent; and Berbice Bridge Company Inc: Loan stock of $40 million bearing an interest rate of 7 percent.
In listing the procedures for submission of Expressions of Interest, the notice said that persons must submit them to the liquidator by the deadline submission date of September 24, 2010, indicating the level and nature of their interest in each of the specified securities and their capacity and timelines to conclude a transaction.
The notice said that all Expressions of Interest should be placed in a sealed envelope and deposited to the Liquidator, Clico Head Office, 191 Camp Street, Georgetown. “Clico, under liquidation, is not bound to accept any Expression of Interest and reserves the right to deal and/or treat any or all of the Expressions of Interest in a manner it deems fit.
On Thursday President Bharrat Jagdeo announced that 11,290 of Clico policyholders will get back all of their money in about three weeks. He announced too that while just under 7,000 persons’ policies would have been covered by cash available on Clico’s books, to the tune of $600 million and setting aside $100 million for administrative purposes, the Government was injecting $3.6 billion received from the CARICOM Petroleum Stabilisation Fund to cover the other categories of policyholders and investors, although some of these policies would be capped to a ceiling of $30 million each.
The President said that the long term insurance portfolios will be separated and hopefully sold to another insurance company. He added that while some insurance companies have already expressed interest in acquiring this portfolio, expressions of interest will be invited from all licenced insurance companies in Guyana and discussions will be accelerated to conclude these.
The President explained that the amount of $3.6 billion will be utilised to finance the payout to policyholders under the company’s classes of business other than long term insurance as follows: $2.7 billion to pay off in full all holders of investment annuity policies and other insurance liabilities not in dispute subject to a maximum limit of $30 million per policyholder.
He explained, “So if you have under $30 million you will get all of your money in full over the next few weeks. That will result in 4,366 holders of Executive Flexible Premium Annuities and other undisputed claims against the company being paid in full.” These, he said, include six pension funds – Grace Kennedy, Davis Memorial Hospital, New GMC, CJIA, Go-Invest and GAWU.
Mr. Jagdeo said this will leave 39 large policyholders with balances in excess of $30 million. He said that this small number of policyholders left will make the prospects of dealing to resolve them easier.
The President said the remaining $900 million of the $3.6 billion will be utilised to pay these policyholders to a maximum of $30 million each, with priority given to non-institutional policyholders.
According to the President, the liquidator hopes to realise another $8.5 billion through the sale of assets, [of which] the book value is [over] $2 billion, legal action on Bosai [Minerals] (regarding a loan that company took from Clico Investment Bank), and against Caribbean Resources Limited (CRL) and Clico Bahamas. He said that from proceeds coming in from sale of assets, the liquidator will address the remaining 39 policyholders,” he said.
At the meeting, the President said the government holds most of the remaining liabilities and these include those held by NIS, the Guyana Forestry Commission, the Dependents Pension Fund and Guyoil.
“So we have to ensure that they are also protected. We will liquidate some of their claims on the sale of assets and from the money that hopefully will realise through legal action, and then the State will determine how it will pay them the balance. We will be meeting with them separately,” President Jagdeo said at the meeting.
A little over a week ago, Chief Justice acting Ian Chang ordered Clico wound up, declaring the company in no position to continue operations, not even under judicial management.