Nov 2013 Financial News

State energy firm for stock exchange

Nov 20, 2013

Government plans to divest Phoenix Park Gas Processors Ltd by putting some of its shares on the local stock exchange.

It would be the first energy stock from the State enterprise sector to be put on the stock exchange.

Finance Minister Larry Howai said Government’s goal was to “multiply the number of State companies on the stock exchange to ensure that in the next five years, we double the number of companies on the Stock Exchange”.

Howai was speaking in the Senate yesterday, at Tower D, International Waterfront Centre, Port of Spain, on the Insu­rance (No 2) Bill.

He said the new insurance bill ensures proper cross-border supervision of companies, particularly with respect to the management and supervision of overseas subsidiaries.

“This is to ensure that we do not have the kind of contagion risks that occurred when the CL Financial Group mel­ted down. In fact, the Trinidad and Tobago Government had to provide quite substantial support to the region and to insurance companies in the re­gion to ensure that there was not a wider financial melt­down,” he said.

He added that giv­en some of the weak­nesses of the regional economies, he was not sure the contributions made by the T&T Government staved off the risks.

Noting the insurance industry in T&T had $23 billion in assets, Howai said the aim of the bill was to maintain confidence in and promote soundness and stability of the finan­cial system in Trinidad and Tobago and maintain an appropriate measure of protection for policyholders and beneficiaries.

“The passage of the bill is intended to ensure that the industry has a sound regulatory and supervisory framework within which to operate,” he said.

The bill was introduced and debated earlier this year and lapsed.

It had been previously before a joint select committee (JSC). Howai said the last consultation on the bill took place in 2009, and it had been decided the consultation process would be reopened.

In this regard, the JSC agreed to secure an independent expert, via the Parliament from a Com­­monwealth country to help with the bill. He said 12 applications have been received and the new JSC will evaluate them.

Howai said the bill represented a comprehensive overhaul of the legislation gov­er­n-

ing the insurance industry.

“It deals with issues of go­vernance structure, capital requirements, the registration process, duties and powers of the inspector. In accor­-

dance with international best practice, it removes the statutory fund mechanism and introduces the risk-based capi-

­tal ratios for local insurance industries,” he said.

The bill was in line with Government’s vision of where the insurance industry should be over the next decade. He said the financial services sector accounted for over 15 per cent of GDP and was the second largest sector after the energy sector. He said at present, the industry operates under the 1980 Insurance Act.

Government wanted to make Trinidad and Tobago the premiere financial servi­ces destination, he said, adding over the past year, the country had been able to attract $250 million in new investment and over 1,000 jobs in the financial services sector over the past year.


Source:
By Ria Taitt
Trinidad Express

Wednesday November 20, 2013