PORT OF SPAIN, Trinidad and Tobago, July 8, (CMC) – The Trinidad and Tobago government says policy holders with the cash-strapped Colonial Life Insurance Company (CLICO) will benefit from a billion dollars (One TT dollar =US$0.16 cents) payment, even as the Finance Minister acknowledged that the regional conglomerate “is still insolvent with an excess of liabilities over assets”.
Finance Minister, Colm Imbert, told the Senate, yesterday, that despite the fact that “not all of the assets of CLICO have been disposed of; it is now proposed that all outstanding resident statutory fund short-term investment products be paid in full.”
Imbert said this would “result in a cash payment to the government of about TT$1.3 billion for the balance of the EFPA (Executive Flexible Premium Annuity) and the payment of about TT$100 million to other policyholders.”
CLICO is part of the CL Finance Group that collapsed in 2009 and received billions of dollars in state funds.
Last week, Prime Minister, Dr. Keith Rowley, said that the report of a commission of enquiry into CLICO contained allegations of criminal misconduct of a “kleptocratic nature” by several people associated with the group, and that the Director of Public Prosecutions, Roger Gaspard, has been given a copy of the report with a request that he act on it urgently.
Imbert told legislators that the new payment initiative had the advantage of “resulting in a positive cash flow for the government, while also enabling a positive statement to be made, that all outstanding resident statutory fund policyholders were now able to access all their funds
“CLICO can now repay the TT$400 million due to third-party policyholders, in advance of making payments to the government on its TT$2.1 billion liability,” he said, adding that it “will not affect the amount which government will receive on this liability, but will slightly change the timing.
“Government will be paid upon the sale of Methanol Holdings International Ltd. or given value on the completion of the valuation of Home Construction, whichever comes first,” he said, adding that the non-assenting policyholders “will now all be paid the remaining 15 per cent value of their policies owed to them.”
Imbert said the CLICO resolution plan was ongoing and further resolution would be made on a regular basis as it unfolded.
He said measures proposed for other creditors will be announced, in due course, and that “the auditors have confirmed that the amount expended by, or due to, the government on the CLICO bailout is close to TT$22 billion.”
Imbert said that the Keith Rowley government was “hopeful, at this stage, that it can recover a significant amount of this sum, but this will depend on the success of the disposal of the remaining assets of CLICO and CLICO Investment Bank, among other things.
“CLICO is still insolvent with an excess of liabilities over assets of the order of one billion dollars and, as a result, has indicated that it is not in a position to relinquish control of CLICO at this time.”