Feb 2007 Financial News

No worries as Valentine’s pact ends—Republic boss

Feb 14, 2007

Republic Bank managing director, David Dulal-Whiteway, said yesterday that he was not concerned by today’s expiration of the ten-year standstill agreement, signed on Valentine’s Day, between insurance giant Clico and Republic.

The agreement was meant to prevent Clico from exerting overt influence on the decisions of the bank by preventing the appointment of executives of the insurance company to the Republic board.

I am not concerned. It (the expiration of the agreement) does not bother me. I did not get up this morning thinking that I might lose my job tomorrow,” said Dulal-Whiteway at a press conference yesterday.

Stating that the Valentine’s Day agreement was “not top of mind” for Republic’s executives, Dulal-Whiteway said, “Both parties have demonstrated that we can work well together.”

As proof of his statement that Clico and Republic Bank work well together, Dulal-Whiteway referred to the purchase “without any fanfare” by the CL Financial group in October 2004 of 15.9 million Republic shares from First Caribbean International Bank. That purchase took the interest of CL Financial, the holding company of Clico, in Republic Bank from 43 per cent to 54 per cent.

Dulal-Whiteway said he believed there were two main reasons why the CL Financial group would not seek to disturb the status quo at Republic—the results and proposed changes to the laws governing financial institutions.

If you sit down as the major investor and you look at the results that we have been producing, I don’t think you would want to change what is considered to be a winning formula. They recognise that very well,” said Dulal-Whiteway.

On the issue of laws, Dulal-Whiteway said that the Central Bank is insisting that one person cannot sit on the board of more than one local financial institution. He said guidelines to this effect were contained in the new Financial Institutions Act which is being discussed.

There is this whole big issue of not having interlocking directorships among financial institutions,” said the bank executive.

Rather than being at loggerheads, the banker said there were opportunities for Republic and Clico to work together. While agreeing that the bancassurance concept had failed, Dulal-Whiteway noted that insurance is required when customers purchase cars or homes.

‘We’re interested in RBTT’s non-T&T assets’

On the issue of the interest by a foreign bank in RBTT, Republic’s larger local rival, Dulal-Whiteway said, “Republic’s position is that there is need for a strong indigenous Caribbean bank.” He said while a merger between RBTT and Republic would lead to an over-concentration in T&T, “because we have a Caribbean vision, we felt that if there were opportunities to look at any of (RBTT’s) assets outside of Trinidad, we would be interested.


Source:
The Trinidad Guardian
Wednesday 14th February, 2007

http://www.guardian.co.tt/business4.html