Paper: CIBC to go after Republic Bank stake

Friday, February 13, 2009

Canadian Imperial Bank of Commerce (CIBC) is aiming to buy the 55% stake Trinidad & Tobago financial services holding CL Financial had in Republic Bank, local daily Trinidad Express reported, citing unnamed sources that say the Canadian bank is holding meetings with the government.

Contacted by BNamericas, a CIBC spokesperson declined to comment on what the bank called rumors.

At the end of January, the Trinidad & Tobago government announced CL Financial, which owns local insurance company CLICO, CLICO Investment Bank (CIB) and several other financial firms, would begin liquidating assets.

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The government also said it would take over CL Financial's stake in Republic Bank through government institutions such as First Citizens Bank and social security agency National Insurance Board (NIB), which already held 14% of the bank.

A takeover by an international firm such as CIBC will not improve Republic Bank's operations or profitability, local daily Newsday quoted Republic's managing director David Dulal-Whiteway as saying.

On Friday, the central bank is expected to take full control of both CLICO and British American Insurance, another of CL Financial's insurance holdings, as set out in the MOU defining the agreement between the government and the holding company, Trinidad Express reported.

Representatives of the central bank were not immediately available for comment when contacted by BNamericas.

Earlier this week, central bank governor Ewart Williams said the rescue of CL Financial and its subsidiaries will likely cost approximately TT$6bn-8bn (US$958mn-1.28bn).