New CLICO fund continues to trend downward

PORT-OF-SPAIN, Trinidad, Thursday January 17, 2013 – The CLICO Investment Fund (CIF) listed on the Trinidad and Tobago Stock Exchange (TTSE) on January 7 at TT$25 per share, but ended the day at $24.90.

This trend has continued for the past 10 days and now stock in the CIF, which was created as part of measures announced by Finance and the Economy Minister, Larry Howai in his national budget presentation on October 1, to compensate CLICO and British American Trinidad investors and policyholders, is valued at TT$23 per share, with some bids coming in on the TTSE as low as $22. 

The CIF, which is being traded on the TTSE’s Mutual Fund Market, had an estimated market capitalisation of TT$5.25 billion when it started trading with 204 million units on January 7. 

The declining value has been a cause of some concern for investors and policyholder who had been able to convert the 11- to 20-year bonds in the compensation package that they received from government into units in the CIF. 

However, spokesperson for the largest representative body for policy owners and investors Peter Permell appears to be taking a circumspect approach to the situation. 

“Because it’s a new security, people are adopting a wait-and-see approach both by the sellers and the buyers,” Permell recently told the Trinidad Guardian. 

“The first distribution is going to take place on February [21]. Therefore what you would find is that most people are going to want to ensure that they get that payment.” Permell predicted that not too many people will offer their units.

“You will get a better picture after that distribution is paid and at the same time you are also going to have Republic Bank Ltd (RBL) half year results which are going to be out by the end of April. You will have people waiting to see how RBL performs in the next half year. You are going to have people who are going to sell for whatever their own personal circumstances,” Permell said, adding that some investors may be treating their investment in CIF as a fixed deposit. 

Jerry Hospedales, chairman of the Clico Trust Corporation Ltd, which is the trustee of the CIF, reported recently that 6582 bondholders exchanged their bonds for units during the initial offer period of November 1 to December 14, 2012.

He said the remaining bondholders who did not, can still do so through any broker registered with the Trinidad and Tobago Securities and Exchange Commission, for which there was no deadline. 

TTSE Chief Executive Officer Wain Iton said the dividend payment schedule for the fund will be semi-annual. 

Hospedales also said the 7,983 holders of Short-Term Investment Products (STIPS) from Clico and its sister company British American who have not yet converted their bonds to units have just over two weeks left to do so, if they want to be included in Republic Bank’s first dividend payment to CIF unitholders on February 21, 2013. 

“You must be on the register by January 29 to be eligible for that first dividend payment. But you have to exchange your bonds for units by January 24, because it takes five days to get new unitholders registered,” Hospedales advised.  Click here to receive free news bulletins via email from Caribbean360. (View sample)