business@tribunemedia.net
FRIDAY, MAY 4, 2018
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Sebas: ‘I smell a rat’
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Threatens legal action over $50m project stall
‘Huge step’ for oil exploration ‘game changer’
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
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EBAS Bastian’s property development arm is threatening to sue the Ministry of Works over “discriminatory and biased treatment” of its $50m corporate office project. The Island Luck chief’s Veridian Development Group on Wednesday issued the Ministry, and Town Planning Committee, with a seven-day ultimatum to lift the eight-month “Stop Order” that has forced work at the western New Providence project to grind to a halt. Tribune Business sources yesterday suggested that the lengthy stall could have cost Mr Bastian’s company up to $25m in real estate sales, while also forcing some 60 construction workers to seek work elsewhere.
* Works, Town Planning get 7-day ultimatum * Island Luck boss seeks 8-month ‘Stop’ end * Claims rival treated ‘more favourably’
These figures were not disputed by Mr Bastian yesterday (see other article on Page 1B), while a major foreign investor in the project - whose involvement has already been approved by both the National Economic Council (NEC) and Central Bank - was said to have totally lost confidence in The Bahamas and wants to withdraw their capital.
Alfred Sears QC, Veridian’s attorney, in a May 2 letter to Desmond Bannister, minister of works, said civil works at the Veridian Corporate Centre had been in progress for seven months until the Department of Physical Planning “suspended all approvals” in early October 2017. The letter, which has been obtained by Tribune Business, added that “numerous demands, requisitions and inquiries” were then imposed on Veridian and Mr Bastian’s other property firm, Brickell Management Group (BMG), which was acting as the office complex’s development companies. Despite complying with all these requests, Mr Sears’ letter sets out a history of
AN OIL exploration “game changer” for the Bahamas took “a huge step forward” yesterday with the signing of a three-month exclusivity deal on a drilling joint venture. Simon Potter, the Bahamas Petroleum Company’s (BPC) chief executive, told Tribune Business it had reached agreement with “a highly respected, major international oil company” to begin negotiations on a potential exploration partnership that would result in the “spudding” of a well in waters south-west of Andros. The Bahamian-based oil explorer will entertain no other parties during this period, with Mr Potter suggesting the exclusivity agreement was “indicative of how they view” BPC’s project and its prospects of success. He declined to name BPC’s potential partner, citing confidentiality agreements, but it will pay BPC $250,000 per month for the duration of the initial exclusivity - netting the company a total $750,000. The prospective “farm-in” partner also has an option to extend the exclusivity for a maximum further three months, again paying the same rate. Mr Potter said recent global oil price increases had boosted BPC’s longrunning joint venture partner search, with the increased margins and profits whetting the industry’s appetite for offshore exploration. “You and I have been talking about the interest a third party may or may not have in this project for quite some time now,” he told Tribune Business. “It’s [the exclusivity agreement]
delayed or no responses by Physical Planning officials, plus instances where Veridian/BMG submissions could not be found and had to be re-sent. The former attorney general also contrasted the “obstacles” placed in Veridian’s way with the planning authorities’ seemingly “more favourable” treatment of a rival corporate office complex located several hundred yards further down West Bay Street. Mr Sears’ letter alleged that this project was approved by the Town Planning Committee within three months of its application’s submission, and is purportedly
SEE PAGE 6
ISLAND LUCK CHIEF: IT’S ‘STIFLING GROWTH’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
SEBAS Bastian yesterday said he “smells a big fat rat” over the enforced eight-month halt to his $50m project, with the delay highlighting how Bahamian economic growth “is stifled”. The Island Luck chief told Tribune Business it was “little wonder investors are running scared of The Bahamas”, branding the “Stop Order” imposed on the Veridian Corporate Centre by the planning authorities as “very suspicious”. Suggesting that the “halt” was little thanks for his decision to “invest in
* Says ‘little wonder investors running scared’ * ‘No problem’ if all given equal treatment * But questions arise if all permits in place developing my country”, Mr Bastian said the Department of Physical Planning, Ministry of Works and Town Planning Committee had imposed conditions never previously encountered in his 30-plus real estate developments. Attorneys acting on behalf of Mr Bastian’s Veridian Development Company and Brickell Management Group (BMG) yesterday threatened to launch legal action against the Ministry and Town Planning Committee
within seven days unless the “Stop Order” on the corporate offices development is lifted (see other article on Page 1B). Tribune Business sources yesterday suggested that the lengthy stall could have cost Mr Bastian’s company up to $25m in real estate sales, while also forcing some 60 construction workers to seek work elsewhere. These figures were not disputed by Mr Bastian yesterday, while a major foreign investor in the project - whose involvement
has already been approved by both the National Economic Council (NEC) and Central Bank - was said to have totally lost confidence in The Bahamas and wants to withdraw their capital. However, other contacts yesterday suggested the Department of Physical Planning was correct to halt the Veridian Corporate Centre project because it did not possess all the necessary permits required to start work.
SEE PAGE 6
* BPC SIGNS 90-DAY EXCLUSIVITY WITH OIL MAJOR * AIMS TO CONCLUDE FIRST EXPLORATORY WELL JV * MAJORITY OF FIRST WELL’S $100M TO BE SPENT HERE a huge step forward for the project, especially in the context of improving global oil prices and the thawing of the industry’s attitude with respect to offshore oil exploration.” Mr Potter said the decline in oil prices over the past few years had driven the industry to focus on onshore oil exploration/ production assets, which were closer to delivering success and cheaper to acquire. The speed at which renewed interest in BPC’s Bahamian licences had materialised into something tangible, he suggested, showed the company’s prospects of success - and the potential quantity of commercially extractable oil - were among the industry’s best. “With the improvement in oil prices, those prospects that have survived the downturn, those projects of scale and commercial attraction, they will be among those to get support the soonest,” Mr Potter said. “The extent to which a major international oil company is actually prepared to pay for a period of exclusivity, for a period of time in which they are the sole party with which we will negotiate, is indicative of how they view the
SEE PAGE 4
GOV’TS POINTE FINDINGS BRANDED AS ‘HOGWASH’ By NATARIO MCKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net THE BAHAMIAN Contractors Association’s (BCA) chief yesterday blasted as “hogwash” the Government’s finding that The Pointe is not in breach of its Heads of Agreement on labour ratios. Leonard Sands, the BCA’s president, rejected “outright” both China Construction America’s (CCA) explanation for the ratio of Bahamian versus non-Bahamian workers currently at the site, and the notion that qualified Bahamians cannot be found to perform the work. Responding to the
* BCA CHIEF REJECTS REPORT ‘OUTRIGHT’ * CCA FOUND NOT IN BREACH OF HEADS * DESPITE REVERSAL ON 70/30 LABOUR RATIO Ministry of Labour’s assessment, he challenged the Government to “stop letting people tell you what we can’t do”. Ministry of Labour officials met with Daniel Liu, The Pointe’s president, his vice-president and legal counsel on Wednesday to discuss a report that found
SEE PAGE 4
NEW GOV’T SECURITIES DEPOSITORY BY YEAR-END By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE CENTRAL Bank expects to have a new Central Securities Depository (CSD) ready by the 2018 fourth quarter as part of an overhaul of the Government’s debt management practices. The regulator’s 2017 annual report said a review conducted by the Commonwealth Secretariat, with Central Bank and
* ‘KEY REFORMS’ TO PUBLIC DEBT MANAGEMENT * AND CHANGES FOR $81M DORMANT ACCOUNTS government support, “targeted several key areas for reform” that the latter two are now moving to address in practice.
SEE PAGE 11
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PAGE 2, Friday, May 4, 2018
THE TRIBUNE
Business owners must not forget personal ‘finish line’
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ost persons aspire to one day own and operate their own business. As one looks at the profile of successful business owners, they tend to be smart, hard-working, tenacious and highly-focused individuals who, despite all odds, overcome the many challenges. A recent Dun & Bradstreet study indicates that businesses with fewer than 20 employees have only a nine per cent chance of surviving a decade. Great strategy, skills and a will to survive are thus vital to the success of the 21st century entrepreneur. It is often quite difficult to recognise the truly successful
entrepreneur, who has been able to keep their doors open for an extended period of time. Many who are successful in business may fail when it comes to their own finances. Too often these talented entrepreneurs concentrate so intensely on their business that they neglect their personal financial planning or, in many cases, never separate personal from business finances. Consider a local taxi driver who records a total of $104,000 in gross sales receipts for one year, but renders himself cash and asset poor by the end of that period. One would think that even basic management of his financial records could
render taxi driver “John Doe” a reasonably successful entrepreneur. John Doe, though, must pay closer attention to any number of factors preventing him from reaping the benefits of his labour. Many are simple matters, such as recording every transaction he makes, curbing impulse spending, and minimising fund leakage on vices. Our discussion today takes a brief look at some of the common mistakes successful entrepreneurs make that impede their financial well-being, while offering suggestions for addressing each concern: • They do not implement proper benefits, such
as health and life insurance, and retirement plans. This, unfortunately, befalls too many small business owners. When one begins a business, benefits are often a low priority. Costs may be prohibitive. As time passes, the question of purchasing proper benefits is often not revisited, even if the business has now grown and added employees so it can take advantage of significant group discounts. These matters need to be taken care of as soon as possible. • They do not properly provide for their families should the unexpected occur. Many small business owners scrimp on life or disability insurance, rationalising that “my business is worth millions of dollars” and “if I die my family will be taken care of once the business is sold”. What they fail to consider is that without them, the business is likely to be worth far less. Good life insurance or a rock solid plan of succession is crucial at any stage of the game. • They do not save money outside the business. Small business owners have a tendency to become so focused on their company, pouring money into it so it can grow and prosper, that they fail to save for their future. They may enjoy a very upscale lifestyle while the business is alive and well, but end up with nothing to show for it should the business fail. This is why some small business owners end up working well into their 70s - and even 80s. They never
drew sufficient cash out, and have no choice but to continue working. To prevent this from happening, money needs to be invested during profitable times to fund retirement plans and a diversified investment portfolio. This does not mean sucking the business dry, but rather not putting all one’s eggs into a single basket (the business). This way, even if the business ends, the owner can enjoy a comfortable retirement. • They do not establish a viable succession plan or exit strategy. Many small business owners work very hard to build a successful enterprise and, shortly before they plan to retire, they suddenly wonder: “What am I going to do with my business?” By then it is usually too late and the business dies. As a result, while the company may have sustained the owner’s lifestyle for many years, it suddenly has no value. A plan needs to be put in place five to seven years prior to retirement. It all starts with looking at where the owner wants the business to go (along with having the value of the business assessed). Is there a family member to take over the business? Are there key employees? What about selling to a competitor? If the decision is made to pass the business on to a child, should it be sold or gifted? There may not be any choice if a sale is necessary to fund retirement. Finding someone who is willing to take over the business is quite different
IAN FERGUSON BY
from someone who is capable of running the business. We have seen too many businesses run into the ground by the next generation of ownership. The consequences can be catastrophic, costing the owner his or her retirement stream of income. The core problem is that, too often, business owners live only for today, with no thought of tomorrow. They need to understand that running a successful business is just the first hurdle to achieving financial security. They still need to keep their eyes focused on the finish line. • NB: Ian R. Ferguson is a talent management and organisational development consultant, having completed graduate studies with regional and international universities. He has served organsations, both locally and globally, providing relevant solutions to their business growth and development issues. He may be contacted at tcconsultants@ coralwave.com.
BANKS ASSOCIATION MEETS WITH BOB EXECUTIVES of the Caribbean Association of Banks (CAB) recently called on Bank of The Bahamas to discuss plans for its upcoming conference in the Bahamas later this year. Mary Popo, the Association’s general manager, and directors met with Vanessa Taylor, the bank’s chief operating officer, to provide more information on its work and invite Bank of The Bahamas’ support for the conference. Established in 1974 and based in St Lucia, CAB is managed by an elected Board of Directors and supported by a five-strong secretariat. CAB currently represents 76 member institutions across 20 countries,
FROM L: Donald Thompson, director, CAB (St Kitts); Mary Popo, general manager, CAB; Vanessa Taylor, chief operating officer, BOB; Moya Leiba-Barnes, chairman, CAB conference committee; and Keith A. Johnson, vice-chairman, CAB Conference Committee Photo: Wendell Cleare with a combined asset base strengthens the regional in excess of $41bn as at banking sector”. Its mission December 2016. is “to proactively influence The Association’s vision matters of interest to finanis “to be the collective voice cial institutions through that promotes, protects and education and advocacy”.
A leading vacation resort seeks to employ a
EMPLOYMENT OPPORTUNITY
SR. DIRECTOR HOTEL OPERATIONS FRONT OFFICE DEPARTMENT Job Summary: The Senior Director of Hotel Operations is ultimately responsible and accountable for the daily operations of all aspects of the Front Office, and serves as the senior operating executive in the absence of the Vice President & General Manager of Harborside Resort. This person is instrumental in providing leadership, training, and is responsible for the safety and security of all guests; which is coordinated through the Hotel Assistant Managers.
Zamar Group Companies, Ltd. is a full service audiovisual and event production company, providing sound lighting & video solutions for clients of all sizes, both locally and internationally. We are currently seeking to identify suitable candidates for the position of:
AUDIOVISUAL & PRODUCTION TECHNICIAN
Main Duties and Responsibilities: • Plans and manages the Front Office Operations and related areas of operations to achieve guest satisfaction and quality • Drives the Guest experience to ensure that the company and divisional goals of 100% or better are met. • Provides guidance and leadership to all aspects of the operations, including Housekeeping, Procurement and consistent compliance of hotel policies and quality customer service while maximizing departmental profits. • Conducts ongoing training and development programs; works directly with Department Heads. • Displays outstanding interviewing skills and applies behavioral interview methods when interviewing. • Develops Annual Financial Budgets for related departments for VP of Hotel Operations Review. • Manages annual performance review process for all related departments. Required Qualifications: • Seasoned professional with at least five years’ experience as a department head in front office, reservations and/or housekeeping in a large resort property or in a department that is proven to be complex. • Demonstrated evidence of strong leadership and communication (written & verbal) skills • Competent in the execution of employee recognition and discipline matters. • Thorough working knowledge of the Labour Laws and the Union Employee Industrial Agreement. • Competent in Process Improvement Projects and Root Cause Analysis • An in depth knowledge of managing a divisions profit and loss statements with the ability to drive changes and hit new targets as they become necessary. For consideration please forward resumes to:
Jacquelyn.Gardiner@harborsideresort.com
Core Responsibilities: The Audiovisual & Production Technician will be responsible for assisting with the daily operations of the Zamar Group of Companies Limited Audiovisual & Production Department activities, services and functions. Responsibilities will include (but are not limited to): • • • •
Prepare and coordinate equipment for delivery, set up and operation on work sites Maintain equipment and ensure that faults or damages are logged and repaired Properly and safely load and transport AV & Production equipment to and from worksites Ensure equipment is tested, checked and meets the specifications requested.
QUALIFICATIONS: • • • • • •
Demonstrated ability to maintain high levels of productivity A team player with the ability to deliver excellent customer service Proficient verbal and written communication skills Ability to work evenings, weekends and holidays Ability to lift and move heavy equipment Ability to multitask and learn quickly
REQUIREMENTS: • • •
High School Graduate Minimum 1-2 years experience preferred, but not necessary. Must possess a valid Bahamian driver’s license.
Resumes should be forwarded to humanresources@zamargroup.com for immediate review and consideration by Friday, May 11th, 2018. Absolutely No Telephone Inquiries.
THE TRIBUNE
Friday, May 4, 2018, PAGE 3
Super Value chief: ‘We’re not in bad egg business’ By NATARIO MCKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net SUPER Value’s owner yesterday moved to ease consumer concerns following a voluntary recall of eggs produced by US-based Rose Acre Farms, saying: “We’re not in the bad egg business.” Rupert Roberts, pictured, told Tribune Business: “We get the same brand over time; we don’t change. We get our eggs from Hillandale. We don’t purchase the brand that’s being recalled. We’re not in the bad egg business.” The Department of Agriculture issued a statement yesterday advising the public of the voluntary recall of
eggs produced by Rose Acre Farms’ Hyde Country Farm. “The Bahamas has been determined by the US Food and Drug Agency (FDA) as one of the international locations the recalled eggs were distributed,” the Ministry added. “These eggs were sold under multiple brand names, including Coburn Farms, Country Daybreak, Food Lion, Glenview, Great Value, Nelms, Sunshine Farms, Publix and Sunups.” The Department acknowledged that a social media image was circulating,
purporting to show contaminated eggs were being sold by a Bahamian retailer. “We wish to advise the public that our inspectors have reviewed the batch information on the cartons on the shelves, and have determined that they are not from the original recall list,” it said. “The Department advises, however, that the public exercise due caution and inspect the numbers carefully in the event that products on the shelf are added to the expanded list.” Consumers and retailers have been urged to check carton or packing of their eggs for the following; Plant
number P-1065; Lot code or Julian date between 011102; Plant number P-1359D; Julian Date 048A or 049A; Best by dates APR 02 and APR 03. “Plant numbers and Julian dates are printed on individual boxes, with the Julian date following the Plant number: For example P-1359D-048A,” the Department said. “Consumers should do the following: Do not eat any shell eggs from the lots listed above. If they have any of the above products they are advised to discard the product or return to their place of purchase. “Practice safe food handling and preparation measures. Wash hands,
utensils and surfaces with hot, soapy water before and after handling raw eggs and raw egg containing foods. Preparation surfaces and food cutting utensils that may have come in contact with the potentially-contaminated eggs should be thoroughly cleaned.” Mr Roberts yesterday also addressed concerns over the cost of eggs being sold locally. “The price of eggs is so high is because the duty is so high. It’s 30 per cent, and they allow us 10 per cent, which doesn’t cover our refrigeration and breakage,” he explained. “We don’t have enough of a mark-up on eggs. The retail industry shouldn’t be
selling them because we’re losing money, but the Government is making money and the consumer blames the retailer when they see the prices. It never occurs to them that we have to pay exorbitant duty.” The duty on imported eggs was increased to 30 per cent under the Christie administration in a bid to help Bahamian egg producers. Some told Tribune Business at the time, however, that it was ‘too little, too late’ to save a Bahamian eggproducing industry that had essentially been wiped out, meaning that consumers would still have to purchase imported eggs at a higher cost.
Carnival bands president supports ‘hands off’ Gov’t By NATARIO MCKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net CARNIVAL band owners have seen “pretty good” sales ahead of this year’s festival, Association (BCBOA) president Dario Tirelli said yesterday, describing the Government’s non-involvement as a “positive change”. Mr Tirelli, head of the Bahamas Carnival Band Owners Association (BCBOA), told Tribune Business that the 17 registered band owners were anticipating a successful festival weekend. “I think it’s going to be successful. We have got some bands that have sold out,” he said. “Bands are making money, and we can’t wait for Road March on Saturday. Sales have been pretty good for a lot of bands. It’s still a competition, so they’re not going to reveal numbers, but based on the conversations with the bands, everything is looking good.” Mr Tirelli said much has changed with this year’s Bahamas Carnival festival, but added that this was largely positive. “There have been good, very positive changes. We don’t have the Government’s hand in it any more,” he added. “We have a private
promoter, Polantra Media, which took up the mantle of making sure the concert series happens as best it did in the last three years. The band owners were always a key part of the festival because of the road march. Things are going very well. “The Government’s hands are not in it any more, and that is a plus. With private citizens investing in Carnival, they are trying to make a profit. The Government had so many rules and stipulations that they put in in relation to the bands. We had nothing to say or do with the concerts, the village and all of that,” Mr Tirelli continued. “We did what we have always done without any financial support, and put on the greatest show the Bahamas has ever seen on the road march. With these guys on board, you can see and feel the intense and direct marketing that was needed. The Bahamas and the world is feeling there is a carnival is here.” Michael Pintard, minister of youth, sports and culture, indicated earlier this year that the Minnis administration intended to completely privatise Bahamas Carnival ahead of the 2018 festival. In 2015, the Government spent $11.3 million on the
inaugural event, going over its initial budget of $9 million. The total cost of the first carnival was $12.9 million, with the rest covered by sponsors. In 2016, the festival incurred a cost of $9.8 million, $8.1 million of which was subsidised by the Government. The 2017 financial report has not been released. However, Paul Major, the former Bahamas National Festival Commission (BNFC) chairman, said $4 million was spent on the 2017 version. “The greatest loss is the fact that there is no Music Masters competition. The promotion and the events were government subsidised, and I must applaud the BNFC for what they did in light of what they were dealing with in terms of budgetary constraints and the need for government approval,” said Mr Tirelli. “With private citizens investing they are trying to make a profit, so of course they are going to make as much impact as they can in terms of marketing, sales drive and that sort of thing. The marketing has been really intense, and the band owners have been involved, which is a plus.”
EMPLOYMENT OPPORTUNITY Zamar Group Companies, Ltd. is a full service audiovisual and event production company, providing sound lighting & video solutions for clients of all sizes, both locally and internationally. We are currently seeking to identify suitable candidates for the position of:
AUDIOVISUAL & PRODUCTION MANAGER Core Responsibilities: The Audiovisual & Production Manager will be responsible for managing the daily operations of the Audiovisual and Production Operations Department activities, services and functions and will work closely with Executive Management to execute the business strategy and objectives. Additional responsibilities will include (but are not limited to): • Manage the Audiovisual and Production team members • Conduct regular briefings and roll call before and after events • Oversee the maintenance, inventory, upgrading and delivery of equipment • Supervise, train and evaluate technical operations staff • Ensure appropriate event equipment, timelines, and staffing needs for events are met • Create and design programs to motivate, train and develop employees QUALIFICATIONS: • Ability to read and comprehend projects and technical documents, including architectural drawings and schedules. • Must have knowledge of audiovisual and production equipment, set-up, operations and computer applications. • Ability to manage high volume of assets across multiple venues. • Flexible and able to work non-standard business hours, including weekends and holidays. • Must be able to travel as necessary for site visits, training and other priority meetings. • Excellent customer service, interpersonal, oral and written communication skills. • Valid Bahamian driver’s license. REQUIREMENTS: • Demonstrated abilities in management, event planning and staff supervision. • Minimum 3-5 years experience preferred. Resumes should be forwarded to humanresources@zamargroup.com for immediate review and consideration by Friday, May 11th, 2018. Absolutely No Telephone Inquiries.
PAGE 4, Friday, May 4, 2018
THE TRIBUNE
Potter: ‘Huge step’ for oil Gov’ts Pointe findings exploration ‘game changer’ branded as ‘hogwash’ FROM PAGE ONE
FROM PAGE ONE prospect. “These companies don’t spend money if they don’t have to. To commit to us in this way, and seek a commercial arrangement, is obviously very positive.” BPC’s rate of progress has heated up rapidly in the past week, with the company having also submitted its “Environmental Authorisation” application for the necessary permits in that area to the Government last week. The search for a joint venture partner, who will share the financial and technical burden of drilling its first exploratory well, is the second “parallel path” that BPC has been working on for several years, and it is now moving forward on both fronts. BPC’s licence areas largely straddle The Bahamas’ maritime border with Cuba, covering waters south-west of Andros, which is where that first exploratory well will be spudded.
Mr Potter told Tribune Business that The Bahamas would not have to wait for actual production to feel the economic impact of oil exploration within its territorial waters. “The exploration [on the first well] will last for 90 days and cost up to $100 million, a considerable proportion of which will be spent locally in-country. That’s an immediate benefit,” the BPC chief executive pledged. “I’ve been here seven years this year with a technical commitment to the project. It’s a project of scale and meaningful exploration. It’s a technical project as well as a potential game changer for The Bahamas. “There are parts of the project we’re very comfortable with progressing ourselves; the technical aspects of the project, the environmental and safety aspects of the project with the Government,” Mr Potter continued. “We’re very happy to push that forward. But certainly a company with much
greater resources than ours will provide greater assurance to the Government in terms of delivery of the project. “From a technical point of view, a large company with more resources enhances our chances of success. We benefit, the project benefits, and the Government gets greater assurance from their participation.” Mr Potter readily acknowledged that “it’s not a deal until it’s done”, with much work remaining for BPC to turn the exclusivity agreement into a binding joint venture with agreed commercial and technical terms. Yet he reiterated: “This is a major step forward that a company of this stature is willing to reward us for this period of exclusivity.” The initial 90-day period will involve “a detailed technical evaluation of the company’s licences in The Bahamas and, at the same time, seek to develop a commercial framework for a potential transaction”.
International Financial Institution is looking for a
Relationship Manager for Private Banking
the ratio of workers at the downtown Nassau development was currently 75 per cent/25 per cent in favour of Chinese employees. The Heads of Agreement calls for a 70/30 split in favour of Bahamians, meaning the ratio has been reversed. The Ministry of Labour, in a statement issued yesterday, said: “A report produced by the Department of Labour, with respect to the composition of the workforce at the project, was presented for review and response. The report reveals that there are 73 non-Bahamian workers and 24 Bahamians presently on site. “The Heads of Agreement calls for a 70 per cent Bahamian, and 30 per cent non-Bahamian, workforce composition,” it acknowledged. “The explanation noted is that the present stage of construction, representing the second phase of The Pointe development, is the erection of the superstructure. “This requires specialised post-tension concrete structure workers to complete this phase in a very short timeframe. Qualified Bahamians have been, and continue to be, sought. In the following phases substantially more Bahamian workers and contractors will be engaged in order to comply with the overall 70 per cent Bahamian, and 30 per cent non-Bahamian, workforce composition.” Mr Sands responded:
“I think all of that is fancy words to distract us from the fact that, if the terms of the agreement said a 70 per cent Bahamian workforce and 30 per cent non-Bahamian, and did not expressly say when that ratio needed to be on that site, then that is hogwash. “I also want to challenge and argue against the notion that the work they are doing is beyond the capabilities of a large amount of the workforce in The Bahamas, who do that work every day.” The BCA president added: “I challenge it, and submit that that work is well within the ambit and skills possessed by many of the highly-qualified, high rise construction professionals who work for similarly large construction companies in The Bahamas doing that work. “I would like them to back away from the position that this highly technical work can only be done by this foreign workforce at the pace and capacity they are currently doing it. I do not accept it. I reject it outright. They’re wrong about what they say we can’t do. The Government needs to stop letting people say what we can’t do when the people who are professionals in the industry do this kind of thing all the time.” Earlier this week, Mr Sands suggested the Government should renegotiate The Pointe deal if the developer has not met the $200m project’s prescribed ratio of Bahamian labour. The Heads of Agreement for the Pointe, tabled in
Parliament last year, granted CCA between 400-500 work permits for the $200m development. The deal, dated June 18, 2015, stipulated that Bahamians would comprise 70 per cent of the total construction workforce, once those employed by local sub-contractors were included in the calculation. Bahamian subcontractors were supposed to receive “approximately 40 per cent of development work.... in various classifications”, although these were not listed. The Ministry of Labour yesterday said The Pointe’s construction is scheduled to be completed in the 2020 second quarter. “With factors related to the technical aspects of the present construction phase, and the expected long-term build up of Bahamian workers, the Ministry of Labour has concluded that the Pointe Development is not in breach of the Heads of Agreement,” it added. “The British Colonial Hotel complex also owned by the developer of The Pointe has two non-Bahamian workers and 275 Bahamian employees. Upon completion, the Pointe Development will boast 500 full-time Bahamian workers. The Ministry of Labour and, by extension, the Department of Labour, remains committed to employment and contractual opportunities for Bahamians.”
Core Responsibilities Expand the client base through the identification and acquisition of new clients. Promote the jurisdiction and the institution and its services in developing markets, possess a book of clients and reports to the Head Private Banking. The position is open to candidates who match the following profile: • Bachelor’s Degree in Business or Finance • Minimum 7-10 years advanced experience in, and excellent knowledge of private banking • Has established networks with existing portfolios • Willing to travel • Ability to work under pressure • Flexibility in office hours and hands-on approach when required • Goal oriented, self-motivated, positive attitude and outlook • Excellent oral and written communication, public presentation and client relationship management skills • Proficiency in Microsoft Office • Fluent in English, Spanish, French and Italian Interested persons should submit their curriculum vitae along with a cover letter by May 15th, 2018. Private & Confidential Relationship Manager c/o The Tribune Box DA No. 109193 P.O. Box N-3207 Nassau, The Bahamas
TENDER NOTICE EDUCATION LOAN AUTHORITY PROPOSAL FOR FORENSIC AUDIT SERVICES Proposals are invited from qualified and experienced Accounting Firms (Solicitors) to provide a Forensic Audit for the Education Loan Authority (“ELA”) for the fiscal period January 31st, 2012 to April 30th, 2018. Proposals documents, which include instructions, specifications and other relevant information, can be collected beginning Monday, 7th May 2018 from 9:00 a.m. to 5:00 p.m. for a period of Five (5) working days (Friday 11th May, 2018) at the Education Loan Authority, 7th Terrace, No. 97 Collins Avenue. Please submit One (1) Original Proposal, Six (6) copies of the Original Proposal, One (1) Digital copy on compact disc (CD) or on USB Flash Drive. Proposals are to be submitted in a sealed envelope bearing the name of the individual and/or company, the address and phone number no later than May 21st, 2018 before 5:00 p.m. entitled “PROPOSAL FOR PROFESSIONAL FORENSIC AUDIT, EDUCATION LOAN AUTHORITY” and addressed to:THE CHAIRMAN TENDER COMMITTEE EDUCATION LOAN AUTHORITY 7TH TERRACE, #97 COLLINS AVENUE, P. O. BOX SS-19039 NASSAU, BAHAMAS. A copy of the VAT Certificate of the Solicitor should accompany all proposals. Proposals received after the said date and time will not be considered and no time extensions will be accepted. Pre-solicitation Conference / Option to Review Intentionally omitted Term of Contract Services shall commence upon the issuance of a Notice to Proceed “NTP” Letter and shall remain in effect until such time as the services acquired in conjunction with this Solicitation are completed and the findings and any associated reports are accepted by the ELA. This period shall be no longer than Four (4) weeks from the start date of this Forensic Audit. Minimum Qualifications 0.1 The Respondent shall be licensed to do business within the Commonwealth of The Bahamas. 0.2 The Firm or its Partners shall be licensed and in good standing with the Bahamas Institute of Chartered Accountants. 0.3 The Respondent should have a minimum of Three (3) years’ experience in Forensic Audits 0.4 The Respondent must provide at least One (1) reference from a client to which it has provided said services within the last Three (3) years. If available, such reference should be a representative of the Bahamas jurisdiction. Scope of Work The purpose of this Solicitation is to provide a Forensic Audit of the ELA’s finances in accordance with the Education Loan Authority Act, 2002. Audit Period The Respondent shall provide a breakdown for each stage of the services commencing with January 31st, 2012 through to April 30th, 2018. Audit Reports The Reports shall provide audited financials accompanied by the Management Representation Letter.
THE TRIBUNE
Friday, May 4, 2018, PAGE 5
Trump’s NRA address comes after zigzag on gun-control policy WASHINGTON Associated Press BACK for a return engagement, President Donald Trump’s address to the National Rifle Association last Friday comes after he temporarily strayed from the group’s strong opposition to tougher gun controls following the school shooting in Parkland, Florida — only to rapidly return to the fold. For the fourth year in a row, Trump will speak to the group, which meets this year in Dallas. Last year, he became the first sitting president to appear in more than 30 years, declaring that the “assault” on the Second Amendment had ended. But this year’s speech comes as gun violence is taking on a new urgency after one of the deadliest school shootings in US history. Student survivors of the Feb 14 shooting at Marjory Stoneman Douglas High School that left 17 people dead are now leading a massive national gun control movement. While the shooting has not led to major changes from the White House or the Republican-led Congress, it did — at least briefly — prompt Trump to declare that he would stand up to the powerful gun lobby. He later backpedaled on that tough talk. Trump’s attendance at this year’s NRA convention was announced just days ago and came after Vice President Mike Pence already
PRESIDENT Donald Trump speaks during the National Rifle Association-ILA Leadership Forum, in Atlanta.
was scheduled to appear. Asked why Trump was attending, given the current political tensions around gun violence, White House press secretary Sarah Huckabee Sanders said this week that safety was a “big priority”. But, she added, “We also support the Second Amendment, and strongly support it, and don’t see there to be a problem with speaking at the National Rifle Association’s meeting.” Trump has long enjoyed strong backing from the NRA, which spent about $30m in support of his presidential campaign. The NRA showcased its high-profile guests for the event, with NRA executive director Chris Cox saying
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on Twitter: “We are honored to celebrate American Freedom with @ realDonaldTrump, @VP Mike Pence and others. #2A #watchtheleftmeltdown” But one of the Parkland student survivors, David Hogg, was critical of Trump’s planned attendance. “It’s kind of hypocritical of him to go there after saying so many politicians bow to the NRA and are owned by them,” Hogg said. “It proves that his heart and his wallet are in the same place.”
During a televised gun meeting with lawmakers in late February, Trump praised members of the gun lobby as “great patriots” but declared “that doesn’t mean we have to agree on everything. It doesn’t make sense that I have to wait until I’m 21 to get a handgun, but I can get this weapon at 18”. He was referring to the AR-15 the Parkland shooting suspect is accused of using. Those words rattled some Republicans in Congress and sparked hope among
PUBLIC NOTICE
INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, STEFAN DANA BULLARD of #7 Trumpeter Road, Freeport, Grand Bahama, intend to change my name to STEFUN DANARD AWESUM. If there are any objections to this change of name by Deed Poll, you may write such objections to the Chief Passport Officer, P.O.Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.
NOTICE
NOTICE is hereby given that LINCOLN CARL ST. UBYN HENRY of #14 Maud Street, P.O. Box SS-19463, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 4th day of May, 2018 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
gun-control advocates that, unlike after previous mass shootings, tougher regulations would be enacted this time. But Trump later retreated on those words, expressing support for modest changes to the background check system, as well as arming teachers. After expressing interest in increasing the minimum age to purchase a so-called assault weapon to 21, Trump later declared there was “not much political support” for the move. He then
pushed off the issue of age restrictions by assigning the question to a commission. Trump’s moves have drawn concerns from both sides of the gun debate. “He ran as supposedly the best friend of the Second Amendment and has become gun grabber in chief,” said Michael Hammond, legislative counsel to the Gun Owners of America. Hammond said his members were upset Trump had approved a spending bill that included background check updates. “We’re not confident at all. We are very disappointed.” Kristin Brown, of the Brady Campaign to Prevent Gun Violence, said Trump had offered mixed messages since the Parkland shooting. “Which Donald Trump is going to show up?” she asked. “Will it be the one who sympathized with the Parkland students he brought to the White House, the one who met with members of the Senate ... or the one who had burgers” with NRA head Wayne LaPierre. Several groups have announced plans to protest over the weekend. The protesters will include parents of those killed in Parkland and in other shootings.
NOTICE
NOTICE is hereby given that GEORGINA ALEXA LAWRENCE of Ridgeland Park West, P.O. Box N-3458, Nassau, Bahamas is applying to the Minister responsible for Nationality and Citizenship, for registration/naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 26th day of April, 2018 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, Bahamas.
FINANCING
Mortgage Financing available from overseas sources. Also Project Financing. Business Plan is required.
Call COMMERCIAL SERVICES GROUP
698-0434
PAGE 6, Friday, May 4, 2018
THE TRIBUNE
Sebas - threatens legal action over $50m project stall ISLAND LUCK CHIEF: IT’S FROM PAGE ONE
now much more advanced than Veridian’s despite the latter having sought its approvals some two years earlier. “We write to lodge a formal complaint and demand that you cease and desist from what appears to be disparate, discriminatory and biased treatment of our client in the approval process,” Mr Sears wrote in his letter to Mr Bannister. “We hereby request that the ‘Stop Order’ be removed, as our client has complied with all of the statutory and prudential requirements of the [Planning and Subdivisions] Act and regulations. “If this matter is not satisfactorily resolved within the next seven days, we are under firm instructions to commence legal proceedings against, amongst others, the Ministry of Public Works and the Town Planning Committee without further notice.” The Veridian Corporate Centre is located on a tenacre land parcel off West Bay Street, opposite Old Fort Bay and just west of the Serenity Drive access road to the Serenity gated community. Its business model involves offering office units for sale, with four design
options available to potential clients, in a bid to exploit the growing demand among law firms, financial services providers, family offices and the like for a western New Providence location close to high-end communities and Lynden Pindling International Airport (LPIA). “Veridian Corporate Centre offers a prime solution and well-situated location for your company to effortlessly reach its valued clientele,” the developer’s website states. “Located near prestigious communities such as Lyford Cay and Albany, Veridian Corporate Centre strategically places your company within minutes of high-net worth clients, in addition to some of the finest shops and restaurants in New Providence.” Mr Sears’ letter reveals that BMG, as the project’s development company, obtained a two-year Preliminary Support of Application Approval from the planning authorities on December 17, 2014, subject to certain conditions. Veridian subsequently obtained a permit number on November 3, 2016, after submitting architectural drawings, while its civil works schematics were approved that December. BMG then contracted Bahamas Hot Mix on March 6,
2017, to begin civil works at the project site. “Civil works were progressing normally,” Mr Sears wrote. “BMG responded to all inquiries from the Ministry of Works, and work was preceding as scheduled.” However, in the meantime, a new administration was elected to office on May 10, 2017. “Inexplicably, on October 3, 2017, the Department of Physical Planning issued a ‘Stop Order’ to BMG with respect to the project,” the QC wrote. “On October 11, 2017, the Department of Physical Planning suspended all approvals relating to the project pending a Traffic Impact Study to address any road improvements required to facilitate any traffic from the project. “From October 11, 2017, the Town Planning Committee and Department of Physical Planning imposed a prohibition on BMG through numerous demands, requisitions and inquiries, all of which have been satisfied.” The requested Traffic Impact Study was said to have been submitted on November 17, 2017, but Mr Sears’ letter alleged that the Department of Physical Planning did not acknowledge receipt until two-and-a-half months later. The Department also
requested changes to the civil works as a result of the study, and demanded that Veridian/BMG obtain an excavation permit which was forthcoming on February 9, 2018, following a site visit by the Town Planning Committee. Then, a week later, the Department of Physical Planning sought “a landscape plan, retaining wall to prevent run-off” and a dust protection plan. These were submitted on February 26, 2018, but Mr Sears said there was no response to BMG’s request for a removal of the ‘Stop Order’ and resumption of work. The letter alleged that Ministry of Works’ civil department and Town Planning Committee failed to respond to further requests and, on April 24, 2018, the former also called for a boundary survey. Cara Collie, BMG’s president, then spoke to Charles Zonicle, Physical Planning’s deputy director on April 26. He added that “no Veridian updates could be provided” until changes to the project’s civil drawings were approved. Tribune Business was unable to obtain a response from Mr Bannister before press time last night, despite sending him messages and making phone calls.
LEGAL NOTICE
FINAL NOTICE Pursuant to the provisions of Section 138 (8) of the International Business Companies Act, 2000, notice is hereby given that:CABREÚVA INVESTMENT FUND LTD. has been dissolved and struck off the Register pursuant to Certificate of Dissolution issued by the Registrar General on 20th, APRIL 2018. Dillon Dean LIQUIDATOR
MARKET REPORT THURSDAY, 3 MAY 2018
SECURITY AML Foods Limited APD Limited Bahamas Property Fund Bahamas Waste Bank of Bahamas Benchmark Cable Bahamas CIBC FirstCaribbean Bank Colina Holdings Commonwealth Bank Commonwealth Brewery Consolidated Water BDRs Doctor's Hospital Emera Incorporated Famguard Fidelity Bank Finco Focol J. S. Johnson
t. 242.323.2330 | f. 242.323.2320 | www.bisxbahamas.com
1050.00 1000.00 1000.00 1000.00
1000.00 1000.00 1000.00 1000.00
Cable Bahamas Series 6 Cable Bahamas Series 8 Cable Bahamas Series 9 Cable Bahamas Series 10 Colina Holdings Class A Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Commonwealth Bank Class Fidelity Bank Class A Focol Class B
PREFERENCE SHARES
1.00 103.00 100.00 106.00 105.00 103.00 100.00 10.00 1.01
1.00 100.00 100.00 100.00 105.00 100.00 100.00 10.00 1.00
SYMBOL AML APD BPF BWL BOB BBL CAB CIB CHL CBL CBB CWCB DHS EMAB FAM FBB FIN FCL JSJ
E J K L M N
CORPORATE DEBT - (percentage pricing) 52WK HI 100.00 100.00
52WK LOW 100.00 100.00
CAB6 CAB8 CAB9 CAB10 CHLA CBLE CBLJ CBLK CBLL CBLM CBLN FBBA FCLB
SECURITY Fidelity Bank Note 18 (Series E) + Fidelity Bank Note 22 (Series B) +
SYMBOL FBB18 FBB22
Bahamas Note 6.95 (2029) BGS: 2015-1-3Y BGS: 2014-12-5Y BGS: 2015-1-5Y BGS: 2014-12-7Y BGS: 2015-1-7Y BGS: 2014-12-30Y BGS: 2015-1-30Y BGS: 2015-6-3Y BGS: 2015-6-5Y BGS: 2015-6-7Y BGS: 2015-6-30Y BGS: 2015-10-3Y BGS: 2015-10-5Y BGS: 2015-10-7Y
BAH29 BG0203 BG0105 BG0205 BG0107 BG0207 BG0130 BG0230 BG0303 BG0305 BG0307 BG0330 BG0403 BG0405 BG0407
BAHAMAS GOVERNMENT STOCK - (percentage pricing) 115.92 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
104.79 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
MUTUAL FUNDS 52WK HI 2.13 4.14 1.99 178.69 153.40 1.54 1.70 1.62 1.10 6.99 8.54 6.15 10.52 11.46 10.46
52WK LOW 1.67 3.04 1.68 164.74 116.70 1.48 1.62 1.57 1.04 6.41 7.62 5.66 8.65 10.54 9.57
LAST CLOSE 4.25 17.43 9.09 3.35 1.00 0.18 3.35 8.80 6.10 3.96 10.05 2.84 1.50 7.69 6.10 10.44 6.43 4.20 12.51
CLOSE 4.40 17.43 9.09 3.35 1.00 0.18 3.35 8.80 6.10 3.96 10.05 2.81 1.50 7.69 6.10 10.44 6.43 4.20 12.51
CHANGE 0.15 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.03 0.00 0.00 0.00 0.00 0.00 0.00 0.00
1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00
1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
LAST SALE 100.00 100.00
CLOSE 100.00 100.00
CHANGE 0.00 0.00
109.77 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
0.03 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
109.74 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
FUND CFAL Bond Fund CFAL Balanced Fund CFAL Money Market Fund CFAL Global Bond Fund CFAL Global Equity Fund FG Financial Preferred Income Fund FG Financial Growth Fund FG Financial Diversified Fund FG Financial Global USD Bond Fund Royal Fidelity Bahamas Opportunities Fund - Secured Balanced Fund Royal Fidelity Bahamas Opportunities Fund - Targeted Equity Fund Royal Fidelity Bahamas Opportunities Fund - Prime Income Fund Royal Fidelity Int'l Fund - Equities Sub Fund Royal Fidelity Int'l Fund - High Yield Fund Royal Fidelity Int'l Fund - Alternative Strategies Fund
VOLUME 1,000
1,000 421
VOLUME
EPS$ 0.361 0.932 -0.306 0.281 -1.133 0.000 -1.465 0.638 0.573 0.171 0.631 0.102 0.330 0.000 1.129 0.743 0.832 0.293 0.543
DIV$ 0.080 1.130 0.000 0.230 0.000 0.000 0.000 0.320 0.220 0.120 0.620 0.060 0.050 0.084 0.300 0.500 0.200 0.120 0.570
P/E 12.2 18.7 N/M 11.9 N/M N/M -2.3 13.8 10.6 23.2 15.9 27.5 4.5 N/M 5.4 14.1 7.7 14.3 23.0
YIELD 1.82% 6.48% 0.00% 6.87% 0.00% 0.00% 0.00% 3.64% 3.61% 3.03% 6.17% 2.14% 3.33% 1.09% 4.92% 4.79% 3.11% 2.86% 4.56%
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0.00% 0.00% 0.00% 0.00% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 7.00% 6.50%
INTEREST 6.00% Prime + 1.75% 6.95% 4.00% 4.25% 4.25% 4.50% 4.50% 6.25% 6.25% 4.00% 4.25% 4.50% 6.25% 3.50% 3.88% 4.25%
NAV 2.14 4.13 2.00 179.39 135.02 1.54 1.69 1.62 1.09 7.16 8.22 6.39 11.30 11.67 10.19
YTD% 12 MTH% 0.31% 4.30% 0.16% 5.93% 0.17% 2.36% 4.66% 3.89% 5.58% 6.65% 0.36% 4.29% -0.15% 3.50% 0.23% 3.89% -0.34% 4.66% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69%
MARKET TERMS BISX ALL SHARE INDEX - 19 Dec 02 = 1,000.00 52wk-Hi - Highest closing price in last 52 weeks 52wk-Low - Lowest closing price in last 52 weeks Previous Close - Previous day's weighted price for daily volume Today's Close - Current day's weighted price for daily volume Change - Change in closing price from day to day Daily Vol. - Number of total shares traded today DIV $ - Dividends per share paid in the last 12 months P/E - Closing price divided by the last 12 month earnings
4 | FG CAPITAL MARKETS 242-396-4000 | COLONIAL 242-502-7525 | LENO 242-396-3225
Mr Bastian conceded to Tribune Business that the project did not have a “building permit”, enabling it to start physical construction, but said its contractors were only conducting civil works - installing piping and other below-ground infrastructure - when the “Stop Order” was issued on October 3, 2017. He suggested real estate developments were able to commence without having all the necessary permits in hand, with the relevant approvals obtained as projects progressed. Desmond Bannister, minister of works, could not be contacted for comment before press time, but other sources disputed Mr Bastian’s assertions. “He hadn’t complied with all the requirements,” one added of the reason for the “Stop Order”. “You need all of the permits in place, but they weren’t. This isn’t his [Mr Bastian’s] first rodeo. He should know better. He didn’t have all the permits in place.” The Island Luck chief, though, said the planning authorities had imposed requirements on the Veridian Corporate Centre - such as dust protection and traffic impact studies - that he had never been asked for before on developments such as Venetian West. “It’s very strange the way it is being handled,” Mr Bastian told Tribune Business. “They’re asking for stuff they’ve never asked for before. It’s quite apparent to me there’s an intentional delay on this project for whatever reason. “I’ve seen projects start after me move quite fine, and I’m pretty sure they’ve not been asked to do the things I’ve been asked to do. If it comes back on the traffic study that 100 extra cars come out of there, I can’t widen the road. That’s the Government’s problem.” He suggested that the eight-month “Stop Order” imposed on BMG and Veridian, after civil works
had been in progress for seven months last year, typified The Bahamas’ “ease of doing business” woes. “It’s this type of thing that stifles economic growth,” Mr Bastian said. “When you have these suspicious things happening around the project; the scale of the project, there’s a foreign investor, there’s no wonder people are running scared of this place. “I could invest my $50m abroad. I don’t have to build a $50m office out there. I don’t have to spend my money to develop my country, but I choose to. We started in March last year, and people could have been in those offices already. It’s been eight months since they did the ‘Stop Order’.” Despite initially applying for the Veridian Corporate Centre’s permits in late 2014, Mr Bastian said Venetian West and other real estate development projects that BMG was involved with meant it did not become a focus until 2016. Architectural and civil drawings were submitted to the Ministry of Works, the latter were approved, and Bahamas Hot Mix was hired to begin the civil works. It was only on October 3, 2017, that the Department of Physical Planning issued its “Stop Order”. Mr Bastian said he had complied with all the planning authorities’ subsequent requests, yet the “Stop Order” remained in effect. He suggested that similar requirements were not being imposed on other developers, adding that he would have “no problem” if there was equal treatment for all. The Island Luck chief said planning officials would “disappear”, or not respond, when Veridian and BMG attempted to followup the progress of their submissions and approval applications. “All this kind of stuff is not good for development,” Mr Bastian told Tribune Business. “I can smell a rat.”
VIOLATES BAHAMAS CONSTITUTION
BISX LISTED & TRADED SECURITIES 52WK LOW 3.50 17.43 7.50 3.32 0.90 0.12 3.30 8.40 6.00 3.15 9.00 2.30 1.40 7.30 6.00 8.78 5.67 3.35 12.01
FROM PAGE ONE
THE QUIETING TITLES ACT
BISX ALL SHARE INDEX: CLOSE 1,948.55 | CHG 0.76 | %CHG 0.04 | YTD -115.02 | YTD% -5.57 52WK HI 4.40 19.17 7.50 3.76 1.64 0.19 4.50 8.80 6.60 5.30 11.50 2.71 1.56 9.25 6.10 11.48 8.10 13.67 12.51
‘STIFLING GROWTH’
YIELD - last 12 month dividends divided by closing price Bid $ - Buying price of Colina and Fidelity Ask $ - Selling price of Colina and fidelity Last Price - Last traded over-the-counter price Weekly Vol. - Trading volume of the prior week EPS $ - A company's reported earnings per share for the last 12 mths NAV - Net Asset Value N/M - Not Meaningful
MATURITY 31-May-2018 19-Oct-2022 20-Nov-2029 30-Jul-2018 16-Dec-2019 30-Jul-2020 15-Dec-2021 30-Jul-2022 15-Dec-2044 30-Jul-2045 26-Jun-2018 26-Jun-2020 26-Jun-2022 26-Jun-2045 15-Oct-2018 15-Oct-2020 15-Oct-2022 NAV Date 31-Mar-2018 31-Mar-2018 30-Mar-2018 31-Mar-2018 31-Mar-2018 31-Jan-2018 31-Jan-2018 31-Jan-2018 31-Jan-2018 29-Mar-2018 29-Mar-2018 29-Mar-2018 29-Mar-2018 29-Mar-2018 29-Mar-2018
The QUIETING ACT of 1959 was superseded by the 1973 CONSTITUTION when in 1973 our Constitution became the rule of law. The rule of law is not selective in its application. And any conflict with the rule of law that is the constitution is in violation. And The Bahamas Constitution 1973 gave its citizens the right to own private property as a fundamental right and not merely as a privilege. The Quieting Titles Act, because it is subject to the constitution, can neither supersede the constitution nor take away a citizen’s inalienable right to ownership of private property. From 1973 to date, Forty-four years, the Quieting Act 1959 has been in question: successive Governments have ignored this simple fact. It has always been an obstacle that our country has had no land registry to verify deed titles. The use of affidavits and sworn statements against a documented conveyance is questionable. It requires a degree of honesty that rarely exists. But if there are clear conveyances to any parcel of land and the Quieting Act was cited to take that land from the rightful owner, the constitution was violated and the Quieting Titles Act 1959 proven unconstitutional. The need for a membered lawyer to bring an appeal denies the right to appeal to those who cannot afford and so denies their fundamental right. In a similar vein, unlike a carton of milk with an expiry date or canned goods with a shelf life, our inalienable rights do not have expiration dates. The three-month grace period for redress is also a violation of the constitution. The opportunity for abuse of the Quieting Titles Act is without question. In a society in which special interests are the order of the day and court decisions can be bought, only the privileged have the assurances of rulings in their favour, there is no level playing field. We have a parliamentary system that relies on honesty, but with no safeguards to provide protection. Whether misfeasance or malfeasance occurred within a case, for too long the Quieting Titles Act 1959 has been used to destroy lives: to cause irreparable harm to the financial and psychological wellbeing of those of us without the resources to fight.
When will enough be enough?
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THE TRIBUNE
Basis of preparation
Friday, May 4, 2018, PAGE 7
The consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS), and under the historical cost convention, except as disclosed in the accounting policies below.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise judgment in the process of applying the Group’s accounting policies. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are disclosed in Notes 2(d), 2(g), 2(h), 2(n) and 18. New standards, amendments and interpretations adopted by the Group
Independent Auditors’ Report
Standards and amendments and interpretations to published standards that became effective for the Group’s financial year beginning on 1 January 2017 were either not relevant or not significant to the Group’s operations and accordingly did not have a material impact on the Group’s accounting policies or consolidated financial statements.
To the shareholders of Fidelity Bank & Trust International Limited
Our opinion
New standards, amendments and interpretations not yet adopted by the Group
In our opinion, the consolidated financial statement presents fairly, in all material respects, the consolidated financial position of Fidelity Bank & Trust International Limited (the Bank) and its subsidiaries (together ‘the Group’) as at 31 December 2017 in accordance with International Financial Reporting Standards.
With the exception of IFRS 9 Financial Instruments (IFRS 9), IFRS 15 Revenue from Contracts with Customers (IFRS 15), and IFRS 16 Leases (IFRS 16), the application of new standards and amendments and interpretations to existing standards that have been published but are not yet effective are not expected to have a material impact on the Group’s accounting policies or consolidated financial statements in the financial period of initial application.
What we have audited The Group’s consolidated financial statement comprises:
the consolidated statement of financial position as at 31 December 2017; and
the notes to the consolidated financial statement, which includes a summary of significant accounting policies.
IFRS 9, which is effective for financial reporting periods beginning on or after 1 January 2018, addresses the classification, measurement and recognition of financial assets and financial liabilities, and replaces the guidance in IAS 39 Financial Instruments: Recognition and Measurement (IAS 39) that relates to the classification and measurement of financial instruments. IFRS 9 retains but simplifies the mixed measurement model and establishes three (3) primary measurement categories for financial assets: amortised cost, fair value through profit or loss and fair value through other comprehensive income. The determination is made at initial recognition, and the basis of classification depends on the Group’s business model for managing its financial assets and the contractual cash flow characteristics of the financial asset.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the consolidated financial statement section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Loans and advances, debt securities and other financial assets held to collect solely payments of principal and interest (SPPI) may be classified and measured as amortised cost, with an option to classify such financial assets as fair value through other comprehensive income in cases where such financial assets are also sold with regularity. Financial assets that do not contain cash flows that represent solely payments of principal and interest must be classified as fair value through profit or loss, except that equity securities can irrevocably be designated as fair value through other comprehensive income provided the equity securities are not held for trading.
Independence We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code). We have fulfilled our other ethical responsibilities in accordance with the IESBA Code.
In addition, IFRS 9 will require the impairment of financial assets to be calculated using an expected credit loss model that replaces the incurred loss impairment model required by IAS 39. At initial recognition of relevant financial assets, a provision for impairment of financial assets is required to be recognised based on expected losses due to credit default events that are possible within one (1) year. Financial assets are categorised into three (3) stages based on credit default factors and experiences, and provisions for impairment are recognised based on total expected losses in the event of a significant increase in credit risk or an actual credit default. The assessment of whether credit risk has increased significantly since initial recognition is performed on an ongoing basis by considering the change in the risk of default occurring over the remaining life of the financial instrument, rather than by considering an increase in provision for expected losses. The assessment of credit risk and the estimation of expected losses are required to be unbiased and probability-weighted, and incorporate all available information which is relevant to the assessment including information about past events, current conditions and reasonable and supportable forward looking information specific to the counterparty, as well as forecasts of economic conditions as of the financial reporting date. The estimation of expected losses takes into account the time value of money, which will result in the measurement of impairment being more forward-looking than under IAS 39. Accordingly, it is expected that the allowance for impairment will increase as all financial assets will be assessed for expected losses within at least one (1) year and the population of financial assets to which total expected losses will apply is likely to be larger than the population for which there is objective evidence of impairment in accordance with IAS 39.
Emphasis of matter
The accompanying consolidated financial statement does not comprise a complete set of consolidated financial statements in accordance with International Financial Reporting Standards. Information on the results of operations, cash flows and changes in equity is necessary to obtain a complete understanding of the financial position, financial performance and changes in financial position of Fidelity Bank & Trust International Limited and its subsidiaries. Our opinion is not modified in respect of this matter.
Other matter
The Group has prepared a separate set of consolidated financial statements for the year ended 31 December 2017 in accordance with International Financial Reporting Standards, on which we issued a separate auditors’ report to the Shareholders of the Group dated 3 May 2018.
Responsibilities of management and those charged with governance for the consolidated financial statement
Management is responsible for the preparation and fair presentation of the consolidated financial statement in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of the consolidated financial statement that is free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statement, management is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
For financial liabilities, there were no changes to classification and measurement, except for the recognition of changes in own credit risk in other comprehensive income for financial liabilities designated at fair value through profit or loss. The Group does not have financial liabilities designated at fair value through profit or loss, and accordingly this change will not impact the measurement of financial liabilities.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
IFRS 9 also introduces expanded disclosure requirements and changes in presentation. These are expected to change the nature and extent of disclosures about financial instruments.
Auditors’ responsibilities for the audit of the consolidated financial statement
Our objectives are to obtain reasonable assurance about whether the consolidated financial statement as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this consolidated financial statement.
The Group is in the process of assessing how its business model will impact the classification and measurement of financial instruments, and has a steering committee overseeing the implementation project. The project involves:
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: 2 Bayside Park, West Bayof Street & Blake Road,financial P.O. Box N-3910, Nassau, PricewaterhouseCoopers, Identify and assess the risks of Executive material misstatement the consolidated statement, whether Bahamas T: + 1 242 302-5300, F: + 1 242 302-5350, www.pwc.com/bs, Email: pwcbs@bs.pwc.com due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statement or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statement, including the disclosures, and whether the consolidated financial statement represents the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statement. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
Key decisions – this comprises identifying key decisions, including deciding on the measurement and classification for all products; determining stage migration of financial assets based on credit default factors and experiences; and assessing other relevant factors impacting measurement.
Data mining – this comprises assessing availability of data; defining and determining detailed modelling methodology to be employed based on available data, resources and infrastructure; defining and developing methodology to estimate unadjusted expected losses; and defining methodology to incorporate forward looking information.
Implementation – this comprises finalising forward-looking scenarios and incorporating forward-looking information in estimating expected losses.
Currently, the identification and making of key decisions regarding classification and measurement of financial instruments has been completed and being subjected to validation and challenge, and the process of data mining and developing the model for calculating expected losses is in progress, with data gaps being addressed. The process of implementation has commenced and expected to be completed at the time of financial reporting for regulatory purposes for the first quarter of 2018. IFRS 15, which is effective for financial reporting periods beginning on or after 1 January 2018, deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with its customers. Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. IFRS 15 replaces IAS 18 Revenue and IAS 11 Construction Contracts and related interpretations, and establishes a more systematic approach for revenue measurement and recognition through a five (5) step model. The model comprises identifying contracts with customers and performance obligations, contained therein; determining consideration in the contract and appropriate allocation to each identified performance obligation; and recognising revenue as each performance obligation is satisfied. The impact of IFRS 15 is being assessed through: the evaluation of the inventory of impacted transactions and current revenue recognition; the determination of whether there are multiple performance obligations; and the determination of period over which performance obligations are performed. The preliminary assessment indicates that the impact of IFRS 15 will not be significant on the consolidated financial statements, other than enhanced disclosures.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Chartered Accountants Nassau, Bahamas
IFRS 16 results in lessees accounting for most leases within the scope of the standard in a manner similar to the way in which finance leases are currently accounted for under IAS 17 Leases (IAS 17). Lessees will recognise a ‘right of use’ asset and a corresponding financial liability on the statement of financial position. The asset will be amortised over the length of the lease and the financial liability measured at amortised cost. Lessor accounting remains substantially the same as in IAS 17. The Group has not yet assessed the full impact of adopting IFRS 16, which is effective for financial periods beginning on or after 1 January 2019. (b)
3 May 2018
Principles of consolidation Subsidiaries Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group and are deconsolidated from the date that control ceases. Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of impairment of the asset transferred. Accounting policies of subsidiaries are changed where necessary to ensure consistency with the policies adopted by the Group. Non-controlling interests The Group applies a policy of treating transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in retained earnings. Gains or losses on disposals to non-controlling interests are also recorded in retained earnings. Interests in the equity of subsidiaries not attributable to the Group are reported in consolidated equity as non-controlling interests. Profits or losses attributable to non-controlling interests are reported in the consolidated statement of comprehensive income as profit or loss attributable to non-controlling interests. Joint ventures Joint ventures are entities over which the Group has joint control, and the operations are generally governed by contractual arrangements. Investments in joint ventures are accounted for using the equity method of accounting and are initially recognised at cost. The Group’s share of post-acquisition profits or losses and other comprehensive income or loss is recognised in the consolidated statement of comprehensive income consistent with the recognition by the joint venture, and its share of postacquisition movements in reserves is recognised directly in reserves, with corresponding adjustments to the carrying amount of the investments in joint ventures. Dividends received from joint ventures are recognised as a reduction in the carrying amount of the investment in joint venture. When the Group’s share of losses in a joint venture equals or exceeds its interest in the joint venture, including other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the joint venture. Unrealised gains on transactions between the Group and its joint ventures are eliminated to the extent of the Group’s interest in the joint ventures. Unrealised losses are also eliminated unless the transaction provides evidence of impairment of the asset transferred. Accounting policies of joint ventures are changed where necessary to ensure consistency with the policies adopted by the Group. The Group determines at each date of the statement of financial position whether there is any objective evidence that an investment in joint venture is impaired. If this is the case, the Group calculates the amount of the impairment as the difference between the recoverable amount of the joint venture and its carrying value and recognises the amount adjacent to ‘share of profits or losses of joint ventures’ in the consolidated statement of comprehensive income.
(c)
Foreign currency translation Functional and presentation currency Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The consolidated financial statements are presented in Bahamian dollars (B$), which is the Bank’s functional and presentation currency. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the consolidated statement of comprehensive income as a part of net income. Translation differences on monetary financial assets measured at fair value through profit or loss are included as a part of the fair value gains and losses.
(d)
Financial assets The Group classifies its financial assets into the following categories: financial assets at fair value through profit or loss and loans and receivables. Management determines the classification of its financial assets at initial recognition. i)
2.
This category has two (2) sub-categories: financial assets held for trading, and those designated at fair value through profit or loss at inception. A financial asset is classified into the financial assets at fair value through profit or loss category at inception if acquired principally for the purpose of selling in the short term, if it forms part of a portfolio of financial assets in which there is evidence of short-term profit-taking, or if so designated by management. Financial assets designated as at fair value through profit or loss at inception are those that are managed and whose performance is evaluated on a fair value basis, and are intended to be held for an indefinite period of time but may be sold in response to needs for liquidity or changes in interest rates, exchange rates or equity prices. Information about these financial assets is provided internally on a fair value basis to the Group’s Executive Committee.
Summary of Significant Accounting Policies The principal accounting policies applied in the preparation of the consolidated financial statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. (a)
Basis of preparation The consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS), and under the historical cost convention, except as disclosed in the accounting policies below. The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise judgment in the process of applying the Group’s accounting policies. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be
Financial assets at fair value through profit or loss
All of the Group’s investment securities classified as at fair value through profit or loss have been so designated by management. ii)
Loans and receivables
THE TRIBUNE The fair value of collateral in the form of property is initially measured consistent with the accounting policy
for investment properties disclosed at Note 2(g), based on valuations performed by independent appraisers who hold recognised and relevant professional qualifications and have recent experience in the category of the properties being valued. Subsequently, the fair value is updated when market conditions indicate a potential decrease in fair value and/or when the customer initially goes into default. As of 31 December 2017, the individually impaired loans can be analysed as follows:
31 December 2017
Mortgages $
Consumer $
Other $
Total $
Carrying amount
21,919,640
7,344,381
4,110,014
33,374,035
Provision for loan losses
11,666,616
5,936,447
1,686,792
19,289,855
Carrying amount
24,392,142
6,904,181
3,709,671
35,005,994
Provision for loan losses
12,631,207
5,291,956
1,581,143
19,504,306
31 December 2016
Other credit risk Insurance premiums receivable, included in other assets, represent unexpired premiums owing by policyholders and can be cancelled without financial penalty to the Group, which minimises the credit risk of such receivables. Credit-related commitments The primary purpose of these instruments is to ensure that funds are available to a customer as required. Guarantees, which represent irrevocable assurances that the Group will make payments in the event that a customer cannot meet its obligations to third parties, carry the same credit risk as loans and advances to customers. Commitments to extend credit represent unused portions of authorisations to extend credit in the form of loans, guarantees or letters of credit. With respect to credit risk on commitments to extend credit, the Group is potentially exposed to loss in an amount equal to the total unused commitments. However, the likely amount of loss is less than the total unused commitments as most commitments to extend credit are contingent upon customers maintaining specific credit standards. See Note 15 for loan commitments. The Group monitors the term to maturity of credit commitments because longer term commitments generally have a greater degree of credit risk than shorter term commitments. Geographical concentrations of financial assets The Group has a concentration of credit risk in respect of geographical area, as both customers and assets held as collateral are based in The Bahamas and the Cayman Islands. See Note 13 for geographical analysis of total income and total assets. Interest rate risk Interest rate risk is the risk that the future cash flows or the fair values of financial instruments will fluctuate because of changes in market interest rates. The Group takes on exposure to the effects of fluctuations in the prevailing levels of market interest rates on both its fair value and cash flow risks. Interest margins may increase as a result of such changes but may reduce gains or create losses in the event that unexpected movements arise. The Group does not attempt to hedge specifically against the impact of changes in market interest rates on cash flow and interest margins and relies on the fact that the loan portfolio generally is based on variable interest rates linked to the US$ LIBOR or prime interest rates in the countries in which the Group operates that generally reset within three (3) months of any change in these rates and has financial liabilities that finance these loans but at lower interest rates, which too are based on US$ LIBOR or prime interest rates in the countries in which the Group operates and can be reset following the maturity of any deposits. The Group maintains a general policy of fixing the interest rate spread between interest earned on financial assets and interest incurred on financial liabilities. The table below summarises the Group’s exposure to interest rate risks, and includes the Group’s financial instruments at carrying amounts categorised by the earliest contractual repricing dates. Immediate Repricing $
Up to 3 months $
3 to 12 months $
12 months to 5 years $
More than 5 years $
Non-interest bearing $
Total $
ASSETS Cash on hand and at banks Investment securities Loans and advances to customers Other assets
1,426,770 42,555,968 192,773,236 -
15,067,956 54,820,987 533,262 -
6,217,967 16,852,444 5,154,673 -
16,413,877 67,702,357 -
28,820,718 288,323,653 -
160,387,885 3,872,969 6,692,069
183,100,578 159,463,994 558,360,150 6,692,069
Total financial assets
236,755,974
70,422,205
28,225,084
84,116,234
317,144,371
170,952,923
907,616,791
242,504,124
140,896,284
290,944,407
48,186,293
-
57,544,292
780,075,400
29,900,627
-
10,032,336
4,000,000
-
5,640,391 -
5,640,391 43,932,963
Total financial liabilities
272,404,751
140,896,284
300,976,743
52,186,293
-
63,184,683
829,648,754
Interest repricing gap
(35,648,777)
(70,474,079)
(272,751,659)
31,929,941
317,144,371
107,768,240
ASSETS Cash on hand and at banks Investment securities Loans and advances to customers Other assets
1,818,211 42,526,844 202,724,047 -
51,302,735 392,380 -
9,460,182 9,811,144 6,047,546 -
5,382,727 68,412,245 -
28,126,723 259,496,153 -
111,043,021 5,194,386 6,383,079
122,321,414 137,150,173 542,266,757 6,383,079
Total financial assets
247,069,102
51,695,115
25,318,872
73,794,972
287,622,876
122,620,486
808,121,423
201,250,612
136,327,491
243,261,913
57,474,476
-
40,750,455
679,064,947
29,843,715
-
5,059,444
13,989,371
-
4,965,091 -
4,965,091 48,892,530
231,094,327
136,327,491
248,321,357
71,463,847
-
45,715,546
732,922,568
15,974,775
(84,632,376)
(223,002,485)
2,331,125
287,622,876
76,904,940
31 December 2017
LIABILITIES Deposits from customers Accrued expenses and other liabilities Debt securities
31 December 2016
LIABILITIES Deposits from customers Accrued expenses and other liabilities Debt securities Total financial liabilities Interest repricing gap
As of 31 December 2017, an increase/decrease in market interest rates by 0.50%, with all other variables remaining constant, would decrease/increase net income by $78,800.
Price risk Price risk is the risk that the fair values and/or amounts realised on sales of financial instruments may fluctuate significantly as a result of changes in market prices. Price risk arises from the Group’s investments in government debt securities. The Group has significant concentration risk because a significant amount its investment securities are issued by the Government of The Bahamas or its related entities. Trading levels in The Bahamas, whether on the Bahamas International Securities Exchange or over-the-counter markets, are generally low and therefore, the ability of the Group to liquidate large positions may be difficult and prices received may be severely impacted. The Central Bank has created a secondary market for certain debt securities issued by the Government of The Bahamas, and prices currently being observed in this market and over-the-counter are the face values of such securities. The remaining investment securities have high credit ratings and short terms to maturity. Accordingly, price risk is considered to be limited. Liquidity risk Liquidity risk is the risk that the Group is not able to meet its financial obligations as they fall due or can do so only at an excessive cost. The Group’s liquidity policy is to maintain sufficient liquid resources to cover cash flow imbalances and fluctuations in funding, to retain full public confidence in the solvency of the Group and to enable it to meet all financial obligations. This is achieved by maintaining a prudent level of liquid assets through management control of the rate of growth of the business and maintaining high levels of capital. The table below analyses financial assets and liabilities into relevant maturity groupings based on the remaining period to the contractual maturity dates as of the date of statement of financial position and represent undiscounted cash flows. Repayable on demand $
Up to 3 months $
3 to 12 months $
12 months to 5 years $
More than 5 years $
Total $
161,814,655 13,349,701 -
15,071,435 23,360,918 46,346,745 6,692,069
6,234,535 32,977,946 75,718,575 -
62,520,891 363,820,655 -
78,221,901 432,193,033 -
183,120,625 197,081,656 931,428,709 6,692,069
Total financial assets
175,164,356
91,471,167
114,931,056
426,341,546
510,414,934
1,318,323,059
LIABILITIES Deposits from customers Accrued expenses and other liabilities Debt securities
298,027,772 -
144,088,010 5,640,391 -
296,064,362 12,420,000
49,063,050 41,510,000
-
787,243,194 5,640,391 53,930,000 846,813,585
31 December 2017 ASSETS Cash on hand and at banks Investment securities Loans and advances to customers Other assets
Total financial liabilities
3
298,027,772
149,728,401
308,484,362
90,573,050
-
Net liquidity gap
(122,863,416)
(58,257,234)
(193,553,306)
335,768,496
510,414,934
Loan commitments
31 December 2016
19,305,667 Repayable on demand $
Up to 3 months $
3 to 12 months $
12 months to 5 years $
More than 5 years $
Total $
ASSETS Cash on hand and at banks Investment securities Loans and advances to customers Other assets
112,861,232 13,067,826 -
26,382,350 44,260,602 6,383,079
9,510,295 26,224,193 72,671,684 -
39,996,787 353,231,401 -
77,637,058 421,955,971 -
122,371,527 170,240,388 905,187,484 6,383,079
Total financial assets
125,929,058
77,026,031
108,406,172
393,228,188
499,593,029
1,204,182,478
LIABILITIES Deposits from customers Accrued expenses and other liabilities Debt securities
239,378,221 -
147,687,497 4,965,091 -
249,807,846 8,070,000
59,339,082 43,330,000
10,600,000
696,212,646 4,965,091 62,000,000
239,378,221
152,652,588
257,877,846
102,669,082
10,600,000
763,177,737
(113,449,163)
(75,626,557)
(149,471,674)
290,559,106
488,993,029
Total financial liabilities Net liquidity gap Loan commitments
21,641,382
The relative distribution of financial instruments based on the maturity ranges in the analysis above is representative of the relative distribution of financial instruments that would result on the basis of discounted cash flows. Regulatory authorities set limits for liquidity balances, and the Group was in compliance with these requirements for the years ended 31 December 2017 and 2016. As of 31 December 2017, principal and interest balances of the deposits of the ten (10) largest customers totalled $178,162,870 (2016: $167,532,049) representing 22.84% (2016: 24.67%) of total deposits from customers.
Currency risk Currency risk is the risk that the fair values and/or amounts realised on sales of financial instruments or the settlement of financial liabilities may fluctuate due to change in foreign exchange rates. The Group is not exposed to currency risk, as its financial instruments along with financial activity are predominantly denominated in B$, and Cayman dollar (KY$). The remaining financial instruments and financial activity are denominated in the United States dollar (US$), and currency risk is mitigated because the B$:US$ and B$:KY$ exchange rate is fixed at 1:1 and 1:1.20, respectively. 21.
Fiduciary Risk Management The Group is susceptible to fiduciary risk, which is the risk that the Group may fail in carrying out certain mandates in accordance with the wishes of its customers. To manage exposure, the Group generally takes a conservative approach in its undertakings.
22.
Fair Values of Financial Instruments Financial instruments utilised by the Group comprise the recorded financial assets and liabilities disclosed in the consolidated financial statements. The Group’s financial instruments are principally short term in nature, have interest rates that reset to market rates, or are carried at fair value; accordingly, their fair values approximate their carrying values. For long term financial assets and financial liabilities with fixed interest rates, despite a change in market rates since the issuance of the financial liabilities there has been no observable change in fair values; accordingly, the carrying values approximate fair values. Financial instruments are principally Level 2 in the fair value hierarchy. The fair value of the financial assets and liabilities disclosed under that category have been determined considering, amongst other factors, discounted cash flows, with the most significant input being the US$ LIBOR, KY$ primate rate and B$ Prime rate as the discount rate. The US$ LIBOR and KY$ prime rates have not experienced significant changes, however B$ Prime rate was reduced by 0.50% effective January 2017, and prior to this change B$ Prime rate had not experienced any changes since the year ended 30 June 2011.
23.
Subsequent Events Subsequent to year end, the Directors approved a dividend on ordinary shares in the amount of $0.71 per share and on Class C redeemable preference shares at the rate stated in Note 11.
Friday, May 4, 2018, PAGE 11
New gov’t securities depository by year-end FROM PAGE ONE
“A critical foreseen reform is the passage of a Public Debt Management Act to provide the legislative framework for efficient public debt management,” the Central Bank said. “The Act would also promote efficiencies related to dematerialisation, debt management strategies and the oversight of public enterprises’ debt operations. “As an important component of the enhanced public debt management regime, in accordance with international best practices, the Bank is on course to implement a Centralised Securities Depository (CSD) to assist with managing Government securities’ operations, and promote improved monitoring, oversight and transparency. “The Bank has already made significant progress towards the development of its CSD, and expects that it will be ready for deployment during the fourth quarter of 2018.” Any interest savings that the Government can achieve from an improved debt management strategy are vital, given that it continues to struggle under the weight of a near$8bn national debt and $300m-plus annual fiscal deficits that were described as “stubborn” by the Deputy Prime Minister. The Central Bank, meanwhile, added that it was also working to modernise and improve its short-term Treasury Bill processes. “These enhancements, which are scheduled for deployment in 2018, are expected to improve the overall efficiency of this process and promote more
JOHN ROLLE
timely reporting, consistent with international best practices,” it added. The regulator is also proposing reforms to amend the Banks and Trust Companies Regulation Act 2000 in relation to the handling of dormant account balances that institutions transfer to it. “The reforms would extend custodial protection to new asset classes (including securities and precious metals), and transfer unclaimed assets exceeding a certain amount to the Government after a period of ten years in the Dormant Accounts Fund,” the Central Bank said. “The Bank is also exploring technology upgrades and administrative reforms to facilitate easier queries of the dormant accounts’ register by
the public. At end-2017, a total of 41,508 facilities had been transferred to the Bank’s custody, accounting for an estimated $80.9m in unclaimed funds.” The majority of these accounts, some 33,764, contained Bahamian dollar balances, but the greatest value - some $52m - was denominated in US dollars.
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