– Finance Minister
The payout process for Clico (Guyana) policyholders may commence next week, Finance Minister Dr Ashni Singh says.
According to Dr Singh, policyholders will soon be receiving letters inviting them to visit the company on an appointed day, when decisions recently announced by President Bharrat Jagdeo will be implemented. The statements were made during a recent panel discussion featuring Dr Singh and Head of the Presidential Secretariat Dr Roger Luncheon in which issues relating to the impending payout of the company’s policyholders were discussed, the Government Information Agency (GINA) has said.
Singh said that since the announcement by the President that $3.6 billion would be injected to pay off policyholders, the liquidator has been working feverishly to ensure that this was done in a fast but orderly fashion. According to the minister, this could be as early as next week. According to the release, the letter will include a telephone number that can be used for the purposes of rescheduling appointments where necessary.
Referring to the collapse of Clico, Dr Luncheon said that events of such a nature were not frequent in the lives of governments across the region, and consequently deserved careful analysis. He pointed out that CL Financial, the parent company of Clico, was peculiar, since it had a presence in almost every Caribbean territory. As such, when responses were being implemented, the government got a chance to observe and compare its strategies in the face of the crisis.
At Thursday’s meeting with policyholders at the National Cultural Centre, President Jagdeo announced that the $3.6 billion in addition to other available sums would be used to fully repay 11,290 policyholders of Clico (Guyana). Of this $3.6 billion, $3 billion was received from the Caricom Petroleum Fund, to offset Clico’s expenses. The President explained that about $2.7 billion will be used to pay off in full all holders of investment annuity policies and other insurance liabilities not in dispute, subject to a maximum limit of $30 million per policyholder.
Clico (Guyana) invested $6.9 billion (US$34 million) in Clico (Bahamas) which represented 53% of the local company’s assets. This investment, though liquid on paper, was discovered to have been tied up in real estate that the Bahamian company had in Florida. When the Bahamian company was ordered liquidated on February 24 last year, Clico (Guyana) was subsequently placed under judicial management. After a review of the company’s affairs, the judicial manager, Maria van Beek, recommended that the company be wound up but the move was subsequently challenged by directors of the company.
Two Fridays ago, acting Chief Justice Ian Chang ordered that Clico (Guyana) be liquidated, saying that available material points “unerringly” in the direction of its insolvency and it would be against the interests of policy holders to allow it to continue. Justice Chang ordered that the Bank of Guyana be appointed as liquidator to execute the wind-up order.
