T&T govt bails out CLICO
Published:Friday | January 30, 2009 | 5:48 PM
The Patrick Manning government in Trinidad and Tobago announced a major bail out package to assist the CL Financial Group, out of serious financial trouble.
Under a Memorandum of Understanding (MOU) signed between the parties, the government will provide funding to the company in exchange for collateral and an equity interest in the Colonial Insurance Company (CLICO).
The licence of the CLICO Investment Bank is also to be revoked as CL Financial moves to divest itself of 55 per cent holdings in Republic Bank Limited and shares in Methanol Holdings Trinidad Limited.
The government is yet to say specifically how much money it will be injecting into CL Financial.
Central Bank Governor Ewart Williams said officials from an unknown foreign firm will be arriving in Trinidad next week and one of their tasks will be to assess the value of CLICO.
In a statement the Trinidad government sought to make it clear that the CL Financial Group was not being granted a hand-out.
The statement said CLICO would come under a degree of Government control in keeping with the size of funding package that may have to be provided.
CL Financial chairman Lawrence Duprey described the agreement as a cure for the financial problems facing the company, adding that it could have proven to be a danger to the financial sector if it was not addressed.