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Jamaica Obsever: Proven Investments to buy the Bank of St Lucia International Limited
BY AVIA COLLINDER Business reporter [email protected]
PROVEN Investments Ltd (PIL) has entered into an agreement to purchase 100 per cent of the Bank of St Lucia International Ltd (BOSLIL), an international bank based in St Lucia.
BOSLIL is a wholly owned subsidiary of the East Caribbean Financial Holding Company Ltd (ECFH), a publicly traded company listed on the East Caribbean Securities Exchange.
Proven is targeting the growing market for international banking.
Christopher Williams, president and CEO of PROVEN Management Ltd with responsibility for the operations of PIL, said the deal presents “an exciting opportunity for PROVEN Investments to move into the international finance market with a strong team.
“The global international banking industry has reportedly between US$21-30 trillion in deposited funds. Given its existing regional footprint, BOSLIL is well positioned to take advantage of market share in the local, regional and global markets for international banking services. This is a tremendous global opportunity,” he told the Jamaica Observer.
He said negotiating parties are now moving towards regulatory approval in St Lucia and expect the transaction to close by the first quarter of 2017.
The value of the deal was not shared. But the investment amount, Logan said, reflects a fair price relative to the book value,” of BOSLIL.
BOSLIL, he notes, has over US$300 million in assets and nearly doubles PIL’s existing balance sheet.
PIL this week opened for subscription new preference shares which the company said are intended to fund additional acquisition opportunities, and to expand the company’s investment portfolio. Funds targeted are $2 billion.
PIL itself is incorporated in St Lucia as an International Business Company with its registered office located at Micoud Street, in Castries, St Lucia, and is listed on the Jamaica Stock Exchange.
Its primary business is the holding of tradable securities for investment purposes, but it also pursues private equity opportunities. Acquisitions include Access Financial, Jamaica’s largest microfinancier in which it has a 49 per cent stake.
As described in its online blurb, BOSLIL, the company’s latest target, located within one of the Caribbean’s emerging offshore jurisdictions, offers a range of financial services including the registration of International Business Companies (IBCs).
The head of Proven said the first benefit to its shareholders is “sector and geographic diversification: International banking is historically a robust sector in the Caribbean, and BOSLIL has a strong CEO, team and an established track record.
“BOSLIL currently provides international banking services through its offices in St Lucia, Panama and Uruguay, which provides exposure to other regional growth markets,” he outlined.
He added that the synergy created by the acquisition “will present BOSLIL’s existing client base with PIL’s access to Caribbean investment opportunities and corporate and individual financial products, as well as existing partnerships. Also, PROVEN Wealth’s clients will have access to BOSLIL’s international banking products and services”.
In 2015, as outlined in financials published on its website, BOSLIL made net profit of US$2.51 million to year end December 2015, down from US$3.16 million in 2014.
Interest income, however increased year over year to US$3.8 million up from US$3.63 million the year before. Earnings from fees and commissions also increased to US$2.4 million, up from US$2.1 million the year before. During 2015, operating expenses for the bank climbed to US$4.23 million, coming from US$3.9 million in 2014.
Williams, in commenting on the bank’s performance said, “Although there was volatility in the securities portfolio in 2015, we reviewed the investment assets and are very comfortable with them.
“The investments are primarily fixed income, mostly investment grade, tradable, diversified and are of good credit and asset quality. We are looking towards the long-term income generation capacity and synergies that can be driven by this opportunity’.
Current shareholders of BOSLIL include the Government of St Lucia, Republic Bank Ltd, a consortium of five OECS indigenous banks and financial institutions, National Insurance Corporation (St Lucia), with the remaining 30 per cent widely held by over 4,000 individual and corporate investors from throughout the Caribbean region, the bank’s website indicates.
The East Caribbean Financial Holding Company (ECFH) was the product of a 2001 merger of two financial institutions, the largest commercial bank (National Commercial Bank) and the sole development bank in St Lucia (St Lucia Development Bank).
The Group now claims the position of St Lucia’s and the Eastern Caribbean’s leading financial institution.
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