Republic Bank Not Targeting CL Stake

Trinidad’s Republic Bank is not interested in acquiring the 55% stake the central bank took from CL Financial as part of the latter’s bailout, says a top Republic executive. “We would prefer not to reduce our capital at this time. We want to maintain our strong liquidity position,” the executive says. He adds that while the bank is healthy, with non-performing loans at an “all-time low of 1.8%,” he does expect some deterioration owing to the global recession. He also says that CIBC-owned First Caribbean has indicated interest in buying the CL shares. A First Caribbean banker confirms the bank has had some discussions regarding the acquisition, but adds that no decision has yet been made. “The central bank is working with KMPG on due diligence to determine if the assets will cover liabilities. If there is a deficit, then it is likely that assets will be sold, but if not, then the government will try to get CL Financial back on its feet. This is more similar to a Chapter 11 bankruptcy than Chapter 7,” says the banker.