PM might sue Rowley Administration for BAICO/CLICO balance; but analysts say he should study issues facing two local banks
Antigua and Barbuda is contemplating suing Trinidad and Tobago for the US$60 million still owed to local policy-holders with the collapsed British-American Insurance Company Ltd. (BAICO) and Colonial Life Insurance Company Limited (CLICO).
However, two financial analysts say the news of this lawsuit is nothing but a “deflection” from the Browne Administration’s more pressing troubles in the banking sector.
Making the rounds last weekend was a copy of a civil claim filed in the High Court in which the claimants, a Jolly Harbour resident and a Nevis-registered company, are suing a local offshore bank.
That bank reportedly is the repository of a significant portion of the Government’s deposits from the Citizenship by Investment Programme (CIP), which allegedly are being held as security for a number of government loans.
The analysts say the lawsuit is “a big red flag indicating cash flow and possible solvency issues.”
Meanwhile, these sources tell REAL News they, too, have heard rumours that another bank in which the Government is reportedly the largest shareholder is on the sale block.
While the Government does not have to disclose any agreement to sell or the identity of the possible buyer, the sources say that transparency would help to shore up depositors’ confidence and prevent any run on the institution.
Given the Prime Minister’s very aggressive approach to the acquisition of Scotiabank by a local concern, and his public dress-down of the shareholders of ECAB last week, the analysts say the silence shrouding this possible sale is “disquieting to say the least.”
Meanwhile, Prime Minister Gaston Browne says his Government might have to sue the Government of Trinidad & Tobago for failing to make good on a settlement of US$100 million for the crashed insurance companies.
He says the Trinidad & Tobago Government has already paid about US$40 million, and his administration has written to Prime Minister Keith Rowley about the balance. However, Browne claims he has not been treated with the type of respect that usually characterizes relations among countries and colleagues.
Accordingly, he says that Antigua and Barbuda will be writing to the Rowley Administration again, for a third time, with the hope of a settlement.
However, “if they continue to treat us with contempt we will have no alternative but to sue them,” Browne declares.
Browne took over the chairmanship of the sub-committee on insurance within the Currency Union about a year ago.
