Sun | Jun 13, 2021

CLICO remains thorny issue for OECS

Published:Wednesday | March 14, 2012 | 12:00 AM

The Organisation of Eastern Caribbean States (OECS) will continue holding talks with the Trinidad and Tobago government over the establishment of a special fund to assist policyholders affected by the collapse of the Trinidad-based insurance giant, CLICO.

Prime Minister Roosevelt Skerrit said Tuesday that the issue had been discussed between OECS leaders and Trinidad prime minister Kamla Persad-Bissessar during the just-concluded 23rd intersessional meeting of CARICOM leaders in Suriname.

He said the meeting was to help the OECS address the issue of the collapse of British American Insurance Company (BAICO) and CLICO.

"We have gotten some form of commitment, we have not been able to identify with Trinidad and Tobago the full amount of EC$150 million (US$55.5 million), I think we got to about EC$74 million.

"So we have to further engage them to see where we could get the EC$76 million and, of course, the OECS will put in about EC$75 million to create this special fund in an effort to assist the people," Skerrit said.

Last week, Grenada's Finance Minister Nizam Burke told legislators that the Eastern Caribbean Currency Union member countries were continuing to pursue support from the Trinidad and Tobago government that has pumped billions of dollars as part of a rescue plan for CLICO policy holders in that country.

Burke said that the support is being sought from Port-of-Spain for non-traditional policyholders, including policyholders with Executive Flexible Premium Annuities.

At their end of their summit, the Caribbean leaders said they had previously recognised the systemic risk to the regional financial system, and had deemed the financial collapse of CLICO and BAICO in the Eastern Caribbean "as a regional problem which required a regional resolution".

Proposals submitted

They said that a Regional Technical Committee under the chairmanship of President of the Caribbean Development Bank, Dr Warren Smith, has submitted a slate of proposals to address this situation.

"These proposals range from mechanisms to allow for the reimbursement of policyholders, sharing of the burden of this reimbursement among affected states to institutional arrangements to support the stability of the financial system particularly in the Eastern Caribbean.

"These proposals will shortly be considered for adoption by the Council for Finance and Planning with a view to providing early relief to the many policy-holders who have been adversely affected by this situation," the communiqué issued after the summit noted.

It said the regional leaders have since requested the Central Bank governors "to provide an early report on the stability of the financial system in the Community, along with appropriate measures to enhance the regulation and monitoring of financial entities which operate cross-border".