The following statement uttered by the leader of government business Senator Maxine McClean in the Senate yesterday [7/09/2015] sounds an ominous warning […]for long suffering CLICO policyholders. The leader of Government Business in the Senate today warned that there were no guarantees that CLICO policyholders will recoup all their investments
– No Promise. It appears long suffering CLICO policyholders will receive a haircut!
The BU family is fortunate to have Walter Blackman share his insights about government’s plan to restructure CLICO. Government’s plan is to transfer CLICO assets to New Life Investment Company Incorporated (NLICO). That company would be responsible for issuing Government bonds to CLICO for the purpose of transferring the real estate assets of CLICO to NLICO – Barbados Today. Walter is a trained Actuary and fully aware of the nuance of the Barbados market. BU regards him of one of the most qualified Barbadians to comment on this issue.
The following is a comment posted by Walter in response to a question from the Blogmaster.
@Walter – The BIPA appears to be in favour of the restructuring plan therefore one must assume they are fully apprised of the risk.
It would indeed be unbecoming and disrespectful of me to make any unflattering remarks about the efforts of the BIPA at this time. The biggest risk the BIPA faces is that it might have been given a front row seat invitation to witness and participate in the burial of its policyholders’ hopes. I said hopes, because that is all the policyholders are left with.
However, similar to the little dog in the nursery rhyme, I must “laugh to see such fun” that results when fools try to play the part of wise men.
Let us look at this CLICO problem from a very basic and simple standpoint.
If I were Prime Minister of Barbados, and thought that at least one Barbadian had common sense, I would have been forced to provide that one Barbadian with four elementary pieces of information:
1.The present value of CLICO’s total liabilities
2.The present level of CLICO’s verified assets
3. The level of statutory reserves CLICO ought to have
4. The level of Statutory reserves CLICO actually has
David, have you seen or heard any of this elementary data coming from the PM or the MOF?
The Prime Minister accused the Judicial Managers of paying themselves “dizzying millions” from CLICO’s remaining assets. Why couldn’t he tell Barbadians the exact figure?
If, despite the fact that CLICO possessed “dizzying millions”, the company was still forced into Judicial Management, how can he convince me and you that the government intends to inject $53 million dollars in the new company and that will be enough to solve the problem? Who pulled this 53 million dollars out of a hat?
If you were to look closely at some of the high level personnel involved with NEWCO (or NLICO or whatever it is called), you will discover that they are people who have come to the end of their careers and have very little to lose, reputation wise. We have already discussed Wismar Greaves, the deputy chairman. From all reports, Clennel Goodman, the chairman, is a RETIRED banker. George Hutson is a former MP and cabinet minister who the Prime Minister wants us to believe lacks the ability to serve in the senate or in his cabinet. So, for the time being, we can view him as a RETIRED politician.
Finally, if you had listened carefully to the recent utterances of Dr. Ralph Gonzalves, PM of St. Vincent and the Grenadines on CLICO, you would have come away convinced that Dr. Gonzalves was accusing the Government of Barbados of deviating from its promises made to him and other prime ministers by trying to use this inadequate and unilateral approach.
If they could deliberately try to bamboozle their prime ministerial colleagues from the OECS, do you think they would think twice about tricking and outfoxing the BIPA? I certainly don’t.
As I said before, stay tuned.