Basseterre, St. Kitts - St. Kitts-Nevis’ Minister of Finance Hon. Dr. Timothy Harris has stressed the need for the Federation to update insurance laws to ensure that statutory deposits are sufficient and to address regulation and oversight to protect tax payers.
Dr. Harris recently met with Chairman of CLICO Holdings Barbados Ltd. Leroy Parris in an attempt to get a full understanding of the possible reach of the recent upsurge of challenges of Trinidad-based CL Financial Group, the parent company of regional insurance companies CLICO and British American.
Trinidad’s government currently has control of both insurance subsidiaries there as part of a billion-dollar bailout plan for the cash strapped conglomerate.
However, according to Parris, most of the east Caribbean branches report to CLICO Holdings Barbados, which he said is “very liquid and highly capitalized” and is operated independently of CL Financial Group in its operations, management and investment undertaking. He also indicated that the Central Bank of Barbados remains highly confident of CLICO Holdings’ financial health and stands by CLICO Holdings.
In an exclusive interview with SKNVibes, St. Kitts-Nevis’ Minister of Finance Hon. Dr. Timothy Harris said the discussion focused on the financial troubles and implications in St. Kitts-Nevis and stressed the importance of understanding the extent of the nation’s exposure caused by the recent events.
“This is the first tangible sign of the impact of the international recession moving in contagion throughout the region. And so, we tried to ascertain the measure of confidence we could have in the financial group [CLICO Holdings Barbados Ltd.] and its companies including British American and CLICO based in St. Kitts. The Chairman said in terms of CLICO, with just over 4000 policy holders in St. Kitts-Nevis, the company is controlled by Barbados which was in a very stable position in relation its level of liquidity.
“We are hoping that they [CLICO officials] would make it their duty to continue to keep themselves up to date with similar developments. Although we do not see any need for panic, people must be careful to observe all new developments in the matter.”
Harris said because CL Financial is a private entity, “one does not have much knowledge of its management and regulation” which provides an “information void in relation to the reassurance we need to make”. He further stated that his Ministry hopes that CLICO provides timely and periodic reports to make their investors and depositors fully aware of the situation.
The Minister of Finance informed that the issue was addressed at the last meeting of the Eastern Caribbean Central Bank (ECCB) Monetary Council adding that the next meeting is expected to discuss the matter in detail as the various representatives would have a “good collective idea of the implications each nation may be exposed to”.
Dr. Harris said his Ministry has so far been able to collect data based on the value of local investments into subsidiaries of CL Financial to submit to the Government of Trinidad with the aim of allowing it to better assess the quantity of local investment for an accurate bailout plan.
