Jan 2007 Financial News

Large trading in JMMB shares no need for alarm, says Williams

Jan 03, 2007

Jamaica Money Market Brokers (JMMB) has denied speculation in financial circles that its principals - Keith Duncan and his sister, Donna Duncan-Scott - are trading down their position in the investment firm after more than 34 million JMMB shares crossed the floor on the last day of trading on the Trinidad & Tobago Stock Exchange (TTSE) last year.

"Trust me, the Duncans have no reason to sell," Cedric Stewart, JMMB director, assured the Business Observer.
He was supported by Leo Williams, executive director of JMMB Securities. "The shares have been trading, but we don't believe any new ownership or a reduced ownership has taken place," said Williams. "The people who have that volume are few, so we are not alarmed or concerned."

The December 29 trade brought the total transfer of JMMB shares for the year to nearly 100 million.

"JMMB held its title of volume leader for a fifth consecutive week ,with 34.6 million shares traded, or 91.88 per cent of the TTSE market," said a report from Trinidad-based West Indies Stockbrokers Limited for the week ended December 29. "The volume leader for 2006 comes as no surprise as JMMB commanded 44.55 per cent of the market, trading 97.579 million shares."

The activity triggered concerns in the Jamaican brokerage community about the ownership structure of the company founded by the Duncans in 1992.

"There are only three entities capable of making such large trades: Keith Duncan or Donna Duncan-Scott, the Employee Share Option Plan or Clico Investment Bank," said a local broker who requested anonymity. "It must be one of them, but what we don't understand is why such large movements of stocks."

Further speculation by at least one broker that it was actually JMMB Securities transferring the shares back to JMMB in order to ensure in-house management of the funds, given that JMMB Securities doesn't have a managing director, was also denied by Williams.

"JMMB Securities could not do this, because we don't have a license in Trinidad, only Jamaica," explained Williams. "Plus, I am providing oversight as the executive director while we search for a new managing director."

Glenford McLeish, former managing director of JMMB Securities, resigned last month.

Financial sector sources also suggested that the trade could have been Clico Investment Bank, known in Trinidad for its aggressive appetite for acquisition, transferring its JMMB holdings to its subsidiary, Republic Bank of Trinidad & Tobago. This, however, could not be confirmed.

"I haven't looked into the details of the transfer," added Williams, "but I understand it could be a situation where shares are being traded from the right pocket to the left pocket, as there is no new ownership of shares."

According to JMMB's 2005 annual report, Clico is the largest shareholder with 404.4 million JMMB shares. Duncan controls, directly and through related parties, 120 million shares, while Duncan-Scott owns 124.5 million in the same manner.

Dennise Williams,
Business Observer staff reporter
Tha Jamaica Observer
Wednesday, January 03, 2007
http://www.jamaicaobserver.com/magazines/Business/html/20070102T190000-0500_117375_OBS_LARGE_TRADING_IN_JMMB_SHARES_NO_NEED_FOR_ALARM__SAYS_WILLIAMS.asp