Jamaica News

Suicide is suspected in the death yesterday morning of one Brian Lee, at his home on East Avenue in Kingston. Unconfirmed reports indicate that Lee (who happens to be the son of Brasco Lee, a  former Jamaica Labour Party member of Parliament and junior minister for agriculture) was an investor in the Olint investment scheme, and that he took his life because he lost a hefty sum when the investment scheme crashed in 2008.

According to the police, Lee was found dead at his home at about 6:45 a.m. His neighbours reported that they had not seen him since Sunday, and thus they forced open his door and found his body. His licensed 9mm pistol was reportedly found beside his body, which had a single gunshot wound to the head.

According to Minister of Finance and the Public Service, Audley Shaw, Jamaica’s Government does not plan to introduce any new taxes over the next two years.

Quoted recently, while speaking at a post-2010 budget forum, Shaw reportedly said “It is not my intention over the medium term, and certainly during the term of the International Monetary Fund (IMF) agreement, over the next 27 months, to introduce any new tax at all. We are going to focus on tax compliance, and we are going to focus on widening the tax net.”

It will be interesting to see if Minister Shaw manages to keep this promise.

Effective today, September 17, 2009, the Bank of Jamaica has further reduced the interest rates offered on its Certificates of Deposit by 100 basis points (1%), for a cumulative 450 basis points (4.5%) since July 24, 2009. The six-month benchmark rate will therefore move to 17% per annum from 18%.

The full schedule of new rates is displayed below:
30 days – 12.50%
60 days – 13.00%
90 days – 15.50%
120 days – 15.70%
180 days – 17.00%

The Bank of Jamaica, Jamaica’s central bank, has advised that new-shaped One and Ten Dollar coins will go into general circulation on Tuesday, September 8, 2009. It is important to note that coins bearing the old designs will remain legal tender and will continue to circulate alongside the
new-shaped coins until the stock of the old-shaped coins is exhausted.

New-Shaped Jamaican One Dollar Coin
The current seven-sided design (heptagonal) of the Jamaican One Dollar, will be replaced by a round coin with the heptagonal shape within the circle. The coin will continue to bear the portrait of The Right Excellent Sir Alexander Bustamante, National Hero. All other technical specifications remain unchanged. See image below.

New-Shaped Jamaican Ten Dollar Coin
The current scalloped-shaped design of the Jamaican Ten Dollar, will be replaced by a round coin with the scalloped shape within the circle. The coin will continue to bear the portrait of The Right Excellent George William Gordon, National Hero. All other technical specifications remain unchanged. See image below.

Today, Jamaican-Canadian billionaire Michael Lee-Chin, agreed to sell AIC’s Canadian retail investment fund business to Canada’s largest insurer, Manulife Financial Corp. Under the deal, for which a price-tag is yet to be revealed, Manulife Mutual Funds will control all AIC funds in Canada. AIC will continue to perform in the capacity of fund sub-adviser for Manulife Mutual Funds. If the deal is approved, MFC’s mutual funds under management will increase 38% to approximately CAD 13.7B (USD 12.5B).

Effective today, Thursday, 30 July 2009, the Bank of Jamaica will reduce rates offered on all tenors of its open market instruments by 150.0 basis points.

The revised interest rate structure is detailed below:
30-day tenor – previously 16.00 | now 14.50
60-day tenor – previously 16.50 | now 15.00
90-day tenor – previously 19.00 | now 17.50
120-day tenor – previously 19.20 | now 17.70
180-day tenor – previously 20.50 | now 19.00

Over the past few days, Joseph P. Connolly – the officially appointed liquidator of Olint TCI Corporation Ltd. – has been running ads (see image below) in the Jamaican press, inviting claimants of Olint TCI to forward their claim along with certain information about their account to his attention via email, post or fax.

Notably however, the notice indicates that this relates specifically to Olint TCI which was incorporated in the Turks & Caicos islands in April 2006, and does not include Olint Corporation Ltd., Overseas Locket International or any other entity incorporated in Jamaica or elsewhere that may be linked to David Smith and Tracy Smith, the shareholders of Olint TCI.

Thus, many Jamaicans (who invested heavily in Olint) are now left wondering if they’ve been left in the cold with regard to recovering all or part of money they may have invested in David Smith entities that are not being covered by the current compulsory liquidation of Olint TCI. The official liquidator has identified monetary assets in the U.S. and Turks & Caicos totalling a just US$13 million, a mere drop in the bucket according to some sources, and specifically earmarked only for those who invested via Olint TCI.

Kingston Wharves Ltd.’s results for the three months ended March 31, 2009 (Q01 2009) were weak, as the Jamaican dollar devalued which led to a jump in finance costs. The company posted a loss per share of J$0.13 vs. earnings of J$0.09 per share (yoy). Domestic tonnage dropped 38.09% to 336,526.

Kingston Wharves’ Chairman & CEO, Grantley Stephenson, expressed that he is not confident that it will be revived this year, however, they are looking at ways to minimize costs and intensify their marketing efforts. Kingston Wharves’ stock has fallen 50% year-to-date.

- First Jamaica Investments Ltd Focused on Preserving Value in 2009
- Lascelles, deMercado and Company Ltd Sees Improved 6M 2008-2009
- Pan-Jamaican Investment Trust Ltd Reveals Impressive Q01 2009
- Desnoes & Geddes Ltd Changes Date of Dividend Consideration
- GraceKennedy Ltd Reports Stellar First Quarter Earnings, Other Income Soars
- Carlton Savannah REIT (Jamaica) Ltd Reports Results for Q01

Capital & Credit Financial Group Ltd (CCFG) hosted its first Annual General Meeting at the Knutsford Court Hotel yesterday. Mrs Rosalie Deane, Senior Vice President, Business Strategy & Development opened the meeting with a prayer. Then, Mr Audley Gordon of Deloite & Touche read the independent auditor’s report.

The Group President & CEO, Mr Ryland T Campbell outlined the 2008 results and said that although the Company was not completely insulated from the most recent financial crisis, it was not protected from the crisis in the 1990’s either, but it pulled through regardless. He also said that the Company is currently the best capitalized merchant bank on the island and has grown into a leaner, more efficient organization. He said CCFG is still young and described it as being in its “teenage years” which presents its own set of challenges. He also noted that is has been one year since the Group listed on the Jamaica Stock Exchange and Trinidad & Tobago Stock Exchange.

Then, Mr. Curtis Martin, Deputy Group President, Banking and Investment Services & CEO, Capital & Credit Merchant Bank (CCMB) outlined the Group’s performance in banking. He said that higher interest income and a foreign exchange gain during the year offset trading losses, so the Company was able to earn a profit. He said that the Group’s Efficiency Ratio as at the 2008 results deteriorated as a result of the slip in gains from securities trading, but the Company is looking to expand in other areas, like foreign exchange and control costs (especially the cost and productivity of staff which is being addressed) in order to improve the ratio.

Campbell said that the Group did not anticipate the economic conditions in 2008, especially the further deterioration towards the end of the year. As a result, it was necessary to re‐evaluate the business and the decision that resulted were the layoffs announced earlier this year. He described CCFG as “the only serious stand‐alone Group with a bank” and he commended the team for building the organization from scratch. He said that unlike many other institutions, CCFG does not have a foreign or more‐established, related Company to rely on. He added that it is commonplace for institutions and individuals to look down on or criticize indigenous Companies built up by Jamaicans like CCFG. He said that this is a practice that he would like to see come to an end.

In response to a question about the bank’s provision for credit losses and fair value reserve, Martin responded that 99% of the Company’s investment portfolio comprises GOJ securities – not toxic assets. The decline in the market value of these securities is reflected in the Company’s financial statements, but he is confident that CCFG will recoup its investment at maturity.

Mr Martin said that early in the year (2008), the Company dumped its portfolio of low‐yielding assets at par value. He said that it did not see any significant losses from this strategic decision.

The Group President & CEO commended the Group on its 59‐year record of earning profits and said he expects the Company to post its 60th when first‐quarter 2009 (Q01 2009) results are posted later this week.

Mr Andrew Cocking, Deputy Group President, International Business and CEO, Capital & Credit Remittance Ltd then made his presentation. Beginning with the remittance business, Mr Cocking said that there was a downturn in the 2008 results. The Company made 100k transactions during the period and saw a decline in revenues.

For 2009, he said that the Company will focus on driving revenues and executing more outbound transfers. He also said the Company is offering transfers through the credit unions as they present a great opportunity because of their large customer base. He also said that cost containment would be a top priority going forward.

The Company will market its Reggae Money Express brand in niche markets (US, UK) with the help of Jamaican entertainer Oliver Samuels. It is also seeking a partner in Canada to expand its remittance business there.

Cocking then spoke about Capital & Credit International Inc (CCII) which will launch several new services this year. The Company will offer access to online trading platforms to its clients. It will also allow customers access to online bill payment and US chequing accounts and debit cards. Such accounts will be US Government‐backed. He also said that funds will not be physically held by CCII, as the Company acts as a dealer or broker in the transaction. The funds (minimum of USD 1,500) will be held by Pershing LLC.

Before closing the meeting a vote was taken and all Board Members up for re‐election were re‐elected. The payment of fees of JMD 3.655mm to Non‐Executive Directors was approved and the auditors, Deloitte & Touche were re‐appointed.

Board members added that despite challenges, management expects to run a profitable, safe and secure organization in the long‐run.