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Barita sees future in investment banking

Published:Sunday | August 23, 2020 | 12:08 AM

Jamaica’s oldest stockbrokerage is looking to investment banking as its frontier for growth.

Barita Investments Limited is looking to raise as much as $13.5 billion on the stock market through an additional public offer, APO, its third big fund raising in about 15 months, some of which will finance that build-out.

The company acknowledges some amount of sameness between present and past prospectuses, most notably the plan to grow its branch network, but stresses that it also has fresh goals of going regional and building out the investment banking operation, which is led by Terese Kettle.

“In addition to her present team, Terese is looking to add capacity especially in terms of deal-flow. It is a critical part of our strategy because when we came in, we deliberately set about retaining those who were there and adding talent where necessary,” Barita Vice President for Asset Management & Research, Ramon Small-Ferguson, told the Financial Gleaner.

Barita’s first two market offers, rights issues in March and September of 2019, raised $9 billion.

“Some of the capital raised via those offers would have been tied up in that business in some way, shape or form,” said Small Ferguson, while noting that investment banking was a capital-intensive operation.

Around $1.5 billion from the APO will be utilised to further grow the investment banking unit, and $1.8 billion will be poured into new products, such as structured notes.

Barita also wants to add a wealth management division to cater to high net worth individuals, the VP said.

As for the branch expansion, the company says two new outlets, one Kingston and the other in Montego Bay, would be completed by the end of the next financial year, September 2020.

Small-Ferguson said others would follow but did disclose the locations.

The company is investing more than $4 billion in total to expand its footprint in Jamaica and the region.

“The regional expansion is already in train. The business that we do does not need a physical presence. Through our strategic partnerships we’ve been doing business external to Jamaica,” Small-Ferguson said.

The APO at $49 to $52 per share opens for subscription on August 26 and closes September 16.