Republic: Govt not seeking control

Government has assured Republic Financial Holdings Ltd (RFHL) it is not seeking to control the group through the appointment of two directors to its board.

In press advertisements, RFHL confirmed its chairman Ronald Harford and president Nigel Baptiste were called to a meeting with the Prime Minister, Finance Minister Colm Imbert and Communications Minister Stuart Young to discuss the appointment of Michal Andrews and Waltnel Sosa as directors to represent the interests of the National Investment Fund Holding Co Ltd (NIFHL). Government is the largest shareholder in Republic, with 51 per cent ownership, primarily through settlements from the Clico bailout with most of its stake held by NIFHL.

Discussions also centred on the banking powerhouse's agreement to acquire Scotiabank's operations in regional territories. The release comes as questions have been raised about whether Government is moving to control the Republic group through the NIFHL. The issue was the subject of an Express Business story headlined 'Government grab for Republic?' on Wednesday.

"The Government indicated that this was not an attempt by NIFHL or the Government to secure or exercise any control over the operations of the group," RFHL said.

The release stated the executives told the Cabinet team the group had no objections to any nominations, "while stressing the importance of the candidates being suitably qualified, the independence of the nominees once appointed and their fiduciary duty to act in the best interests of RFHL."

The request to appoint directors was good corrupt practice given NIFHL's shareholding, said RFHL.

The meeting took place days before December 4, the date when the group received official correspondence from NIFHL nominating Andrews and Sosa as directors. RFHL said it was satisfied the nominees met the criteria to be directors and understood their responsibilities. They were elected to the board at the bank's annual general meeting on Monday, and their appointments are to be confirmed by the Central Bank.

While much of the release addressed the directors issue, the statement also briefly mentioned Government's interest in the group's agreement with Scotiabank to buy its assets in the Eastern Caribbean, Guyana and St Maarten for US$123 million.

"Throughout this process, both the Government and NIFHL have reiterated their support for the group's strategic direction and acknowledged the independence and impartiality required by all directors of financial institutions," RFHL said.

Earlier this month, Dr Rowley had said Scotiabank's departure from part of its Caribbean markets was a sign of voluntary de-risking and suggested international players may think "you colonials out there aren't worth the trouble". He commented on the development during a media conference at the end of a special Caricom Single Market Economy meeting at Hilton Trinidad, St Ann’s.

Rowley acknowledged that Republic took the opportunity to expand, when advised about the deal, but was concerned about the risks to the region when international players pull out after being told another bank, which he did not name, was also looking to exit the market.