Sep 2010 Financial News

Nicholas to chair new CL Financial board

Sep 20, 2010

The CL Financial board will be one of the first state boards to get new directors soon. The Guardian understands businessman George Nicholas III, the son of property tycoon Issa Nicholas, is tipped to be the new chairman of the financially troubled conglomerate that is now controlled by the State. Economist Indira Sagewan-Ali, attorney Guy Hannays and former Citibank executive Steve Bideshi have been appointed to serve as the CL Financial directors. Nicholas is now chairman of Mora Ven Holdings Limited, a company that was once controlled by its founder Dr Krishna Persad. Holder was appointed in April to replace former Central Bank Governor Dr Euric Bobb who cited “personal reasons” for his departure.

This will be the second stint for Bideshi, who also serves as an advisor to Finance Minister Winston Dookeran, at the empire built by former billionaire, Lawrence Duprey. He was recruited for the post of chief executive of CL Financial under the PNM administration but resigned on January 12 after six months on the job. In July, Holder had presented a five year plan for CL Financial shareholders to turn around the financially strapped company. The plan, which is now in the hands of the People’s Partnership Government, was expected to turn around the company in two to three years. CL Financial has 325 registered shareholders. The Minister of Finance Winston Dookeran announced his plan for Clico depositors in its budget presentation last Wednesday. Dookeran said the state has already spent $7.3 billion on CL Financial bailout. His challenge is that the company’s total assets are $23.8 billion but liabilities are $16.6 million.

To this end, the Government proposed to make a $75,000 initial payment to Clico depositors and 20 bond coupons (one for each year) at zero interest. But this plan is causing a great deal of concern among Clico depositors, including the credit unions. In January 2009, businessman Lawrence Duprey appealed to the Central Bank for a financial bailout. A MOU was signed providing a a package of financial support from the Government with conditions attached—the winding up of Clico Investment Bank and the rationalisation of assets and liabilities of Clico and British American Insurance Company. Both the Central Bank and the former Minister of Finance gave assurances that the principal deposits of policyholders would be returned to them.


Source:
Asha Javeed
Trinidad Guardian
Saturday September 18, 2010

http://guardian.co.tt/business/business/2010/09/18/nicholas-chair-new-cl-financial-board