Apr 2014 Financial News

FCB report for Cabinet

Apr 03, 2014

FINANCE Minister Larry Howai yesterday said the Price Waterhouse Cooper (PWC) audit into the First Citizens Bank (FCB) initial public offering (IPO) will go to Cabinet and then to Attorney General Anand Ramlogan.

Howai made this disclosure to Newsday, in response to a question sent to him during yesterday’s sitting of the Senate. “PWC advised that I’ll get the report this evening.

The report will go to Cabinet and then to the AG,” Howai said yesterday.

Newsday understands the report could be discussed at Cabinet’s weekly meeting today at the Office of the Prime Minister in St Clair. Asked whether the findings of the audit could have implications for the current composition of the board of directors of the First Citizens Group, Howai replied, “I can’t speak to the implications until I see the report.” Prior to entering politics in 2012, Howai was First Citizens Group CEO.

During question time in the Senate, Howai described the FCB IPO as, “famous or infamous.”

He said the IPO had nonetheless netted the State $1 billion in non-recurrent revenue, contributing to a surplus of excess revenue of about $3.4 billion.

Temporary Opposition Senator Stuart Young said he awaits the finding of the audit.

Former group chief risk officer Phillip Rahaman, who purchased 659,588 shares in the IPO (costing $14 million) and then sold it on January 14 for a $12 million profit, was fired from the group on March 25. Questions have been raised in this matter about the role played by Bourse Securities, whose managing director Subhas Ramkhelawan is an Independent Senator and chairman of the Stock Exchange. A relative of Rahaman is employed at Bourse Securities.

Responding to a question Newsday sent to him during yesterday’s Senate sitting, Ramkhelawan said Bourse will issue a statement shortly, “on some of these matters.”

Speaking with reporters following the Senate’s adjournment, Ramkhelawan said his role as a senator has not been compromised by this matter. “If there are any laws that have been broken...if I have not acted in accordance with the laws of TT, then it could be a valid argument,” Ramkhelawan said.

However, he added, “In a sense, questions have been raised with regard to my chairmanship in the Stock Exchange. People have raised other matters. I don’t think there is any matter as far as that is concerned.”

Stating he is under more scrutiny because of the different posts he holds, Ramkhelawan said he will be guided by the country’s laws and the Senate’s standing orders should matters pertaining to the IPO be raised in Parliament.

Declaring that he and Bourse Securities subscribe to the highest standard of integrity and ethics, Ramkhelawan said the company is governed by the Securities Act and its regulator, the Securities Exchange Commission (SEC). Explaining this legislation mandates the company maintain strict client confidentiality, Ramkhelawan said, “I want to assure the general public that we act in accordance with those laws and regulations.”

On whether the SEC is investigating the IPO, Ramkhelawan said Bourse provides the SEC with any information it requests. “We have no outstanding questions from the SEC in our normal course of business,” he said. SEC officials said an investigation into the IPO is ongoing.

Ramkhelawan also said Imitiaz Rahaman is not Bourse’s executive chairman, contrary to certain reports.

Saying that Rahaman became Bourse’s chairman last December, Ramkhelawan said: “Mr Rahaman does not get involved in the day to day operations or management of Bourse. That is a matter for the managing director who happens to be me.”

Minority shareholder rights advocate Peter Permell called on President Anthony Carmona to revoke Ramkhelawan’s senatorial appointment and called on Ramkhelawan to resign as TTSE chairman. Permell hit what he claimed was Ramkhelawan’s “continued deafening silence” on the IPO.

He called on Ramkhelawan and Imtiaz Rahaman to declare any interest they or Bourse Securities have in the IPO.


Source:
By Andre Bagoo and Clint Chan Tack
Newsday
Thursday April 3, 2014

http://www.newsday.co.tt/politics/0,192825.html