(Barbados Nation) International Finance Corporation (IFC), a member of the World Bank Group, has agreed to invest up to US$100 million (BDS$200 million) in Barbadian-based Sagicor Financial Corporation (SFC) to bolster market confidence in the insurance industry and to expand insurance services in the Caribbean.
A release from the Washington-based institution said the transaction was IFC’s “largest-ever in the insurance sector and will consist of an investment of up to US$20 million in common shares, or about a four per cent stake in Sagicor, and up to US$80 million in convertible and redeemable preference shares”.
“The investment demonstrated confidence in the long-term future of the Caribbean insurance industry following several market failures and a tightening of credit arising from the 2008 global economic crisis.
“Insurance gives people the security they need to grow businesses and invest in the well-being of their families,” said IFC executive vice president and CEO Lars Thunell.
“This partnership between IFC and Sagicor will promote greater access to more types of insurance products in the region.”
Meanwhile, Stephen McNamara, group chairman of Sagicor said: “This level of investment by IFC, a highly reputable international institution, is an extreme message of confidence in Sagicor, a tremendous vote of confidence in its management, its operations and its direction.
“But perhaps of even greater importance is the fact that IFC has agreed with us that our existing shareholders should be afforded the prior opportunity to invest in the company as part of this transaction.”
The chairman said the benefits of the partnership and investment in the wider communities will become evident as SFC wisely deploys the funds raised for growth within the region.
According to Thunell: “This partnership between IFC and Sagicor will promote greater access to more types of insurance products in the Caribbean and beyond to Latin America.”
According to Sagicor, it will now seek all applicable regulatory approvals, and will then put the agreed terms of this investment to all shareholders in general meeting for their approval.