Jun 2004 Financial News

JMMB Sub Expands into Barbados

Jun 23, 2004

A full service brokerage house offering both equity and fixed income investment options has been launched in Barbados.

Caribbean Money Market Brokers (CMMB), a leader in the region’s financial markets, is aiming to add value to the financial markets in Barbados by developing a secondary market for the active trading of government bonds. The company was officially launched in style yesterday at the Sandy Lane Country Club.

In an interview with the Barbados Advocate, Robert Balgobin, General Manager for CMMB’s Barbados office, noted that a secondary market for bond trading is the focus of CMMB at the present time.

“I may buy a bond and six months latter I may decide that I do not want to hold onto this bond. You would need to find a market where someone will actively buy and sell this bond, and that is where CMMB comes into play. We will actively make a market for the trading of these bonds in Barbados, that is going to be our niche role in terms of the fixed income securities market. It is a new direction in the market for Barbados,” he pointed out.

The company has been very successful in Jamaica and Trinidad and Tobago, and aims to continue that success in the Barbados market.

“In T&T we started off managing just under US$800 000, and today we manage over US$800 million in funds, so in terms of fund management in the last three and a half years we have done an excellent job,” noted Balgobin.

CMMB is modeled after Jamaica Money Market Brokers (JMMB), which started 12 years ago in Jamaica. The idea was to create an active market for government bonds so that persons could invest in them. In Barbados, persons currently invest in government bonds and wait until they mature.

According to Ram Ramesh, Managing Director and CEO of CMMB, bond prices can decrease or increase, depending on market interest rates, so the value of a bond can vary, just like the value of a stock. “Until now there has not been an exchange where you can go to trade these bonds, so what we are offering is a platform where you can go and find other buyers or sellers who want to sell or buy your bonds. Along with that we have a sister company which does the stock market trading as well in T&T and JMMB Securities in Jamaica as well.”

He continued, “When CMMB was launched in T&T it was the same story, there was no real active trading in bonds and we created that. Now the market is starting to open up much more. When Jamaica Money Market Brokers was founded in Jamaica in 1992, it was also the same story.

What that shows is the need for a company like CMMB to come in and activate the market. There is a lot of liquidity in most of the Caribbean financial markets as well, including Barbados, so a money market player is able to provide alternative homes for these liquid funds.”

Source: http://www.barbadosadvocate.com/NewViewNewsleft.cfm?Record=17992