JMMB Group Ltd, which is the pub­licly list­ed par­ent com­pa­ny of the JMMB group of com­pa­nies, said yes­ter­day that it car­ried out a re­struc­tur­ing ex­er­cise as at March 31, 2023, in­volv­ing some of its Ja­maican mem­ber com­pa­nies.

In a no­tice on the T&T and Ja­maica stock ex­changes, where the com­pa­ny is list­ed, JMMB Group Ltd said the re­struc­tur­ing was un­der­tak­en fol­low­ing the re­ceipt of non-ob­jec­tion by the Bank of Ja­maica, the coun­try’s cen­tral bank.

The com­pa­ny al­so said the re­struc­tur­ing is part of a wider ex­er­cise be­ing un­der­tak­en by the group.

“The re­struc­tur­ing ex­er­cise is aimed at har­mon­is­ing the group’s over­all cor­po­rate struc­ture for its lo­cal and over­seas hold­ings with the struc­ture re­quired for fi­nan­cial groups un­der the Bank­ing Ser­vices Act (BSA) by sep­a­rat­ing fi­nan­cial ser­vices com­pa­nies in the group from non-fi­nan­cial com­pa­nies,” the group said in the no­tice.

It said JMMB Fi­nan­cial Hold­ings Ltd was in­cor­po­rat­ed as a new, di­rect whol­ly owned sub­sidiary of JMMB Group Ltd for the pur­pose of hold­ing di­rect­ly and in­di­rect­ly the shares of all of the fi­nan­cial ser­vices com­pa­nies with­in the group.

The Ja­maican en­ti­ties now held with the fi­nan­cial group head­ed by JMMB Fi­nan­cial Hold­ings as a re­sult of the re­struc­tur­ing are:

• Ja­maica Mon­ey Mar­ket Bro­kers Ltd, to­geth­er with its whol­ly own­er sub­sidiaries:

a) JMMB In­sur­ance Bro­kers Ltd

b) JMMB Se­cu­ri­ties Ltd, and

c) JMMB Fund Man­agers Ltd

• JMMB Bank (Ja­maica) Ltd

• JMMB Mon­ey Trans­fer Ltd

The group said that as a re­sult of the re­struc­tur­ing, the non-fi­nan­cial, Ja­maican com­pa­nies for­mer­ly owned by Ja­maica Mon­ey Mar­ket Bro­kers (JMMB Re­al Es­tate Hold­ings and Cap­i­tal and Cred­it Se­cu­ri­ties) are now held out­side of the fi­nan­cial group un­der the di­rect own­er­ship of JMMB Group Ltd.

The group added that the re­struc­tur­ing will not af­fect the cur­rent op­er­a­tions or ser­vices of the mem­ber com­pa­nies of the group or JMMB Group Ltd’s con­tin­ued list­ing on the Ja­maica Stock Ex­change and the Trinidad and To­ba­go Stock Ex­change.

It added that the re­struc­tur­ing is be­ing done to en­sure con­tin­ued com­pli­ance with the reg­u­la­to­ry frame­work set out in the BSA, “in the con­text of JMMB Fi­nan­cial Hold­ings pend­ing ap­pli­ca­tion to be li­censed as a fi­nan­cial hold­ing com­pa­ny pur­suant to the BSA.”

BOJ is­sues guid­ance

Last month, the Bank of Ja­maica, as part of its com­mit­ment to strength­en­ing the reg­u­la­to­ry frame­work for fi­nan­cial in­sti­tu­tions, is­sued a news re­leased stat­ing that it had em­barked on the li­cens­ing of fi­nan­cial hold­ing com­pa­nies un­der the BSA.

The Bank of Ja­maica said in­ter­na­tion­al ex­pe­ri­ences high­light the im­por­tance of Ja­maica hav­ing an ef­fec­tive con­sol­i­dat­ed su­per­vi­so­ry frame­work to bol­ster the safe­ty and sound­ness of the fi­nan­cial sys­tem.

In out­lin­ing the guid­ing prin­ci­ples of the li­cens­ing the fi­nan­cial hold­ing com­pa­nies, the Bank of Ja­maica said: “Re­or­gan­i­sa­tion is of­ten a nec­es­sary first step to fa­cil­i­tate the sub­mis­sion of a cred­i­ble ap­pli­ca­tion which would meet the cri­te­ria for a fi­nan­cial hold­ing com­pa­ny li­cence.

“In those cir­cum­stances, a pro­pos­al for re­or­gan­i­sa­tion is re­quired to be sub­mit­ted seek­ing the BOJ’s non-ob­jec­tion. The Bank’s con­sol­i­dat­ed su­per­vi­so­ry frame­work pays keen at­ten­tion to en­sur­ing that all fi­nan­cial com­pa­nies with­in the group and all en­ti­ties fa­cil­i­tat­ing fi­nan­cial ser­vices, in­clud­ing Spe­cial Pur­pose Ve­hi­cles that are re­lat­ed to, or con­trolled by a fi­nan­cial group, are in­clud­ed in the con­sol­i­dat­ed fi­nan­cial state­ments of that fi­nan­cial group.

“The Bank does not au­to­mat­i­cal­ly is­sue a fi­nan­cial hold­ing com­pa­ny li­cence fol­low­ing the is­suance of the non-ob­jec­tion to group re­or­gan­i­sa­tion.

“The is­su­ing by the Su­per­vi­so­ry Com­mit­tee of a non-ob­jec­tion to a pro­posed group re­or­gan­i­sa­tion means that the en­ti­ty has put for­ward a group struc­ture that will fa­cil­i­tate ef­fec­tive con­sol­i­dat­ed su­per­vi­sion of the group con­sis­tent with the bank­ing laws.”