(Jamaica Observer) Royal Bank of Canada (RBC) will take a CAD$60 million (J$5.9 billion) loss on the sale of its Jamaican operations to Sagicor Group Jamaica (SGJ).
The sale price of approximately J$9 billion closely reflects the book value of RBC Jamaica’s operations and at least covers the J$5 billion in new capital the Canadian bank injected into local operations since December 2011.
But “an estimated writedown for the proportionate share of RBC Jamaica’s goodwill and other intangibles acquired by RBC in connection with its acquisition of RBTT Financial Group in 2008” will result in a loss.
Sagicor admitted that some job cuts could occur in the short-term.
“This new bank will have the opportunity to grow, having said that you would expect that where there is some overlap between the current banking operations at Sagicor, which is fairly small, and the RBC operations, which is much bigger, there will be some restructuring,” said Richard Byles, president and chief executive of Sagicor Group at a press conference held on Wednesday.
