Money Masters expands

Avia Collinder, Business Writer

Investment firm Money Masters Limited will open new offices in Mandeville and Montego Bay in the first quarter of 2011 in keeping with a plan crafted with major shareholder, COK Sodality Cooperative Credit Union Limited.

With the expansion, Money Masters moves from being a single-office operation in New Kingston to three branches.

Money Masters' Mandeville office - where business will start in January - will be at Mandeville Plaza, where COK Sodality's operations in that town are based.

The investment company, which is owned by COK Sodality and two other shareholders, former COK marketing manager and economist Dennis Hickey and investment analyst Claudette Crooks, has been in operation since June 2007.

Hickey, a director and vice-president of marketing and business development at Money Masters, said the firm, which operates as the wealth-management arm of COK Sodality, intends to leverage this by filling a gap by providing products the credit union cannot offer its members.

The company opened when unregulated investment schemes were posing intense competition to traditional investment houses, but Money Masters officials said the firm has held its own. Funds under management grew by 35 per cent to November this year, compared with the corresponding period in 2009.

"As our product is investment-oriented, we have not been as hard hit as other sectors," said Hickey.

Challenging

He said the first six months of 2010 were somewhat challenging, exacerbated by the Jamaica Debt Exchange.

"That has worked its way through the market now and the environment has normalised with a positive performance and outlook," he told the Financial Gleaner.

Earlier this year, Money Masters launched an online trading site which allows its clients to trade international equity.

According to Hickey, the company's strength lies in portfolio management for institutional investors. In 2009, it underwrote a US$900-million bond by the National Water Commission.

Money Masters has capitalised on its credit union base and the institutional knowledge of its directors, including President Claudette Crooks, who owned Investment Masters Limited, before selling it to Guardian Holdings Limited.

Hickey, a trained economist, worked in the past with COK before its merger with Sodality, as well as Dyoll Caribbean Financial Services Limited and Leder Mode Limited.

The policy direction of Money Masters is guided by the directors, who, in addition to Crooks and Hickey, include Chairman Donald Patterson, Kenarthur Mitchell, Trevor Blake, Christopher Robinson and Derrick Stennett.

Institutional and individual clients

The company manages a portfolio that includes both institutional and individual clients, from its leased New Kingston head office.

"As money managers, we do not yet see it a more viable option to invest heavily in real estate," Money Masters officials told the Financial Gleaner.

Software and working capital, including improvements to the leasehold premises, accounted for capital-development costs at start-up. The initial equity capital was provided by shareholders.

"We did not start with any debt, as at the time of start-up, the cost of borrowing was much too expensive," the business development manager stated.

Competition from unregulated financial institutions was the only opening hurdle.

"In addition, market acceptance was a slight challenge by the institutional clients, as we were seen as the new kid. However, a few clients who knew our track record stood behind us, and with time we overcame this and the trajectory has since been positive," Hickey added.

He said the new company focused on equipping itself with appropriate technology from start-up to ensure the optimum operational and a high standard of service, the Money Masters representative said.

As such, he noted, operational costs, as a percentage of revenue, were quite high, initially. However, over time this ratio is said to have improved.

"Demand has been increasing and we continue to innovate and bring new products to the market," Hickey said.

austanny@yahoo.com