Jun 2010 Financial News

CIB petitions High Court for winding up

Jun 22, 2010

Clico Investment Bank Ltd (CIB), a subsidiary of the CL Financial Group that the T&T Government agreed to bailout in January 2009, has applied to the High Court to be officially wounded up.

Attorney Lydia Mendonca, acting for CIB, on April 16, 2010, petitioned the High Court for the winding up of the bank, which former CL Financial chairman once owned. The petition by CIB is to be heard in the High Court by Justice Ronnie Boodoosingh, who will sit in court room POS 18 on July 1 at 9 am. The petitioner has stated that any creditor or contributory of CIB who wants to support or oppose the making of an order of the petition may appear at the hearing in person or by his attorney. In a published notice, CIB said anyone who intends to appear on the hearing of the petition must serve on or send by post to Mendonca at Lydia Mendonca & Company, Abercromby Court, 86 Abercromby Street, Port-of-Spain, notice in writing of his intention to do so.

“The notice must state the name and address of the person, or, if a firm, the name and address of the firm, and must be signed by the person or firm, or his or their attorney, (if any), and must be served, or if posted must be sent by post in sufficient time to reach the above-named (Lydia Mendonca and Company), not later than 6 pm of Wednesday, June 30, 2010,” the notice stated. Eighteen months ago, Central Bank took control of CIB under Section 44(d) of the Central Bank Act. In 2004, insurance supervision was transferred from the Ministry of Finance to Central Bank. All the third-party assets and liabilities on the books of CIB, as well as CMMB, another subsidiary of CL Financial, were transferred to State-owned First Citizens bank. In 2009, many depositors at CIB transferred their funds to First Citizens.

At the January 30, 2009, press conference Central Bank Governor Ewart Williams held to announce the bailout of CL Financial subsidiaries, including CIB, Williams said: “These liabilities will be matched by resources from the sale of CIB’s holdings of certain high quality assets. “The Central Bank will provde short-term liquidity as needed to ensure that these liabilities are serviced.”
The bank said that CIB’s license will be revoked following the execution of those transactions. CIB faced liquidity challenges in late 2008 and early 2009. In January 2009, the bank faced an unusually high level of withdrawal requests, which Williams said put a strain on its available liquidity resources. Clico was also facing liquidity problems, but nowhere near the levels of CIB.


Source:
Trinidad Guardian
Tuesday June 22, 2010

http://guardian.co.tt/business/business/2010/06/22/cib-petitions-high-court-winding