CIBC Likely Buyer of Republic Shares

Canadian bank CIBC, which holds a 91% stake in Trinidad & Tobago’s First Caribbean Bank, is said to be the most likely buyer of a 55% stake in Republic Bank being held in trust by the local central bank, bankers say. A local banker says it could cost TTD8bn ($1.3bn) to buy the stake. The central bank assumed the holding after bailing out CL Financial in February. “There are behind-the-scenes discussions to sell Republic’s shares,” says a local banker away from the conversations. “We have been aware that CIBC wants to grow in T&T,” he says. The banker adds that First Caribbean’s share of the T&T banking system is less than 1.0%. Another banker knowledgeable about T&T’s financial sector says that other Canadian banks on the islands would not be likely buyers because of their existing market share. He explains that if Scotiabank were to buy the Republic stake, its market share would increase from 15% to about 50%. RBTT’s would go from 25% to 60%. He also says Republic Bank’s market cap is $2.2bn, while total assets for 2008 were about $6.6bn, according to corporate information.