Dennise Williams, Staff Reporter
File
NATIONAL COMMERCIAL Bank (NCB) executives finally broke their silence concerning the Dyoll Insurance debacle during the bank's annual general meeting last Thursday at the Hilton Kingston Hotel, New Kingston.
According to NCB Chairman, Michael Lee Chin, "notwithstanding the enormity of our shareholding, we thought it would be in the best interest of our shareholders to fold our tent at that point because we were not prepared to put any more investment dollars into what we thought at the time was a black hole."
MADE TENTATIVE OFFERS
Mr. Lee Chin referring to the lack of adequate financial information said: "We had not had the opportunity to do the due diligence subsequent to the event." Interestingly, Canadian mutual fund, AIC, also headed by Mr. Lee Chin, had made tentative offers to give Dyoll a capital injection in December, two months after the hurricane.
However, when a series of accounting blunders proved that the initial statement of losses was less than truthful, AIC pulled out of negotiations. However, the board of Dyoll, according to sources, did not inform the regulators that AIC had pulled out. Instead, they scrambled to find alternative financing. This did not pan out.
Thus, the insurance subsidiary of Dyoll with Cayman liabilities of nearly two times their capital base, forced the regulators to act. First, the Jamaica Stock Exchange suspended trading of the shares of Dyoll Group on February 15 at a price of $14.50. Next, the Financial Services Commission (FSC) stepped in and took over the operations of the insurance company in March.
Within days of the take over, the FSC announced that it had sold Dyoll's Jamaican insurance portfolio to Jamaica International Insurance Company, a subsidiary of GraceKennedy. When questioned as to whether NCB could salvage some opportunity from the situation, Mr. Lee Chin answered, "We had not been given an opportunity to mitigate our losses."
NCB SOLD SOME SHARES
And to the rumours that NCB had been selling off shares through its Capital Markets subsidiary to shore up its financial situation, Patrick Hylton, group managing director, said, "Yes, we have sold some shares in recent times but we couldn't sell shares to mitigate losses in Dyoll because we don't know what those losses are at this point."
As to what is actually left of Dyoll at this point, Mr. Lee Chin said: "While the FSC has sold off the insurance company, the holding company, Dyoll Group, still has some assets. I know nothing more." Although the Dyoll Group earned most, if not all, of its revenues from its insurance arm, the company has a coffee farm and export company, Dyoll Wataru Company Limited.
