Chief ex­ec­u­tive of­fi­cer of the Guardian Group, Ian Chi­napoo, yes­ter­day told em­ploy­ees of the re­gion­al in­sur­er head­quar­tered in West­moor­ings, that the com­pa­ny is “strong, well gov­erned and with as­sured ben­e­fits ac­cru­ing to our pol­i­cy­hold­ers and in­vestors,” which will be re­in­forced when it pub­lish­es its sec­ond quar­ter re­sults this week­end.

Chi­napoo was re­spond­ing in an in­ter­nal email to staff of the group to com­ments made by T&T Op­po­si­tion Leader, Kam­la Per­sad-Bisses­sar, on Mon­day night, ques­tion­ing whether the po­ten­tial fail­ure of the NCB Fi­nan­cial Group (NCBFG), the pub­licly list­ed Ja­maican fi­nan­cial ser­vices group, could pose a risk to T&T’s fi­nan­cial sec­tor.

NCBFG is the par­ent com­pa­ny of the Guardian Group, whose of­fi­cial name is Guardian Hold­ings Ltd (GHL).

“There can be a cas­cad­ing fail­ure with­in our fi­nan­cial sys­tem due to the nu­mer­ous in­ter­con­nect­ing link­ages among the NCB Fi­nan­cial Group, Guardian Hold­ings Ltd (GHL), lo­cal banks and fi­nan­cial in­sti­tu­tions with­in our coun­try,” said Per­sad-Bisses­sar, in a speech at a na­tion­al meet­ing of the op­po­si­tion Unit­ed Na­tion­al Con­gress at the Sig­na­ture Hall in Ch­agua­nas on Mon­day night.

In the speech, the Op­po­si­tion leader al­so ques­tioned whether the in­ter­con­nec­tions be­tween NCBFG and GHL could lead to a re­peat of the col­lapse of the lo­cal in­sur­ance com­pa­ny, sim­i­lar to Cli­co’s fail­ure in Jan­u­ary 2009.

“I won­der if you re­mem­ber what hap­pened when Cli­co failed. We had the mas­sive fail­ure of Cli­co and all of the in­sur­ance poli­cies and in­vest­ments peo­ple had made. We can­not sit idly by and let an­oth­er Cli­co hap­pen,” said Per­sad-Bisses­sar, adding, “We can­not sit by and just watch this thing hap­pen and the whole econ­o­my crash­es.”

Per­sad-Bisses­sar said NCBFG’s May 2019 com­ple­tion of its ac­qui­si­tion of a ma­jor­i­ty 62 per cent in Guardian Hold­ings Ltd (GHL), meant what was hap­pen­ing at the Ja­maican com­pa­ny would have a di­rect im­pact on GHL’s pol­i­cy­hold­ers.

She point­ed out that be­tween May 2019 and Ju­ly 2023, NCBFG chair­man, Michael Lee-Chin, and NCBFG di­rec­tors Patrick Hyl­ton and Den­nis Co­hen served on the board of GHL and that the NCBFG share price on the T&T Stock Ex­change had de­clined by about 70 per cent in the last two years.

“I want you to stay with me. This is com­ing right out of your pock­et. It might be long to you, but it is go­ing to reach right in­to your pock­et, to emp­ty your pock­et,” the op­po­si­tion leader said, adding that tens of thou­sands of T&T cit­i­zens held in­sur­ance poli­cies with GHL.

In the in­ter­nal email to staff, Chi­napoo as­sured all stake­hold­ers that “the com­pa­ny con­tin­ues to per­form very well,” notwith­stand­ing hav­ing to ad­just to the new IFRS-17 ac­count­ing stan­dards and the chal­lenges posed by the COVID-19 re­stric­tions in re­cent years.

He said the per­for­mance of the com­pa­ny “is sig­nif­i­cant­ly due to the pru­dent risk man­age­ment and op­er­a­tional strate­gies we have im­ple­ment­ed and con­sis­tent­ly im­proved over many years.

The Guardian Group CEO said the com­pa­ny’s en­ti­ties are con­tin­u­ous­ly mon­i­tored by ap­pro­pri­ate reg­u­la­tors in the var­i­ous ter­ri­to­ries in which it op­er­ates, in ad­di­tion to the in­ter­nal gov­er­nance struc­tures it has in place.

“This gov­er­nance frame­work en­sures that we op­er­ate on the ba­sis of mar­ket-lead­ing man­age­ment prac­tices to pro­tect the in­vest­ments of our pol­i­cy­hold­ers,” said Chi­napoo.

He said the group could as­sure all in­ter­est groups, in­clud­ing its in­vestors, cus­tomers and the gen­er­al pub­lic that its com­pa­nies are “fis­cal­ly healthy and main­tain sig­nif­i­cant re­serves to meet all our fu­ture oblig­a­tions; in­deed of­ten sig­nif­i­cant­ly in ex­cess of the rec­om­mend­ed lev­els re­quired by our reg­u­la­tors.”

Re­cent fi­nan­cial ma­neu­vers

Per­sad-Bisses­sar al­so said that T&T banks and fi­nan­cial in­sti­tu­tions had ex­po­sure due to their in­vest­ments in bonds and notes is­sued by NCB Glob­al, a T&T sub­sidiary of NCBFG.

Per­sad-Bisses­sar re­called that in March 2020, she had ques­tioned eight fi­nanc­ing trans­ac­tions worth al­most TT$3 bil­lion for state en­ti­ties, the man­date for which was won by NCB Glob­al. An­gus Young, broth­er of En­er­gy Min­is­ter Stu­art Young, was the CEO of NCB Glob­al at the time.

She said in March 2023, NCB Glob­al was in the lo­cal mar­ket look­ing to raise US$30 mil­lion in se­nior, se­cured, dual-tranche, fixed-rate notes, which were se­cured by TT-dol­lar se­cu­ri­ties in the name of GHL.

An­oth­er NCBFG sub­sidiary was look­ing to raise US$25 mil­lion in pref­er­ence shares in Jan­u­ary 2023, she said.

“A num­ber of the bonds that NCB Glob­al raised for the PNM were ac­tu­al­ly fi­nanced by our lo­cal banks. Some of the bor­row­ings were se­cured in the name of GHL.

“Clear­ly, the very fright­en­ing news of Mr Lee-Chin’s re­cent fi­nan­cial ma­neu­vers are cause for con­cern,” said Per­sad-Bisses­sar.

She said NCBFG chair­man Lee-Chin had liq­ui­dat­ed bil­lions of dol­lars of as­sets in the last two years, in­clud­ing sell­ing mil­lions of shares in the Ja­maican group.

“This se­ri­ous­ly makes the pub­lic wor­ried about the fi­nan­cial health of both NCB Glob­al and Guardian Hold­ings Lim­it­ed,” she said.

T&T’s op­po­si­tion leader called on Cen­tral Bank Gov­er­nor, Dr Alvin Hi­laire, Fi­nance Min­is­ter, Colm Im­bert, Prime Min­is­ter Dr Kei­th Row­ley and the boards of GHL and NCB Glob­al to guar­an­tee the peo­ple of Trinidad and To­ba­go that their in­sur­ance poli­cies and fi­nan­cial in­vest­ments with GHL and NCBFG were safe.

She said, “I am call­ing on them to tell us: does the po­ten­tial fail­ure of NCBFG pose a sys­temic risk to our fi­nan­cial sec­tor?

She al­so told the au­di­ence that she was not cast­ing as­per­sions on any of the com­pa­nies she men­tioned in her speech.

“I am call­ing for clar­i­ty from Gov­ern­ment re­gard­ing what is be­ing pub­lished in the me­dia. Some­thing seems to be very wrong with the NCB Fi­nan­cial Group.”

Lee-Chin re­sponds

Guardian Me­dia yes­ter­day send the video of Per­sad-Bisses­sar’s speech to NCBFG chair­man and GHL di­rec­tor, Michael Lee-Chin, and re­quest­ed a com­ment from him.

He said, “We have al­ways fo­cused on the things we can con­trol, and ex­e­cut­ed them to the best of our abil­i­ties, ir­re­spec­tive of what oth­ers may say.

“That’s how we be­came suc­cess­ful and we won’t change our for­mu­la now.”