Now that the erstwhile Independent Senator and Chairman of the T&T Stock Exchange has finally done the honourable thing, I am persuaded that the time has come for the First Citizens Bank (FCB) Chairman Nyree Alfonso and her fellow directors to follow Mr Ramkhelawan's lead.
However it is clear that this is going to be a bitter pill for them to swallow given the valiant, but for the most part self-serving, PR campaign that has emerged in certain quarters to try to excuse the Board from any responsibility and/or culpability, in what I have now coined "The-We-Put�You�Last-FCB-IPO-Fiasco."
It has taken the form of paid advertisements or info-mercials at shareholders' expense; and in some instances, pro bono surrogates. In the case of the ads, the key message that stands out is: "...the Board had no oversight of the Allocation Process. Therefore, the Board did not have any knowledge of the quantum of shares employees or any other prospective shareholder would receive." Therefore, the board "Nah leaving!"
The other thing that stands out is that the steering committee which was "recommended" by the Ministry of Finance (MoF) to manage the divestment process (IPO) comprised, among other persons, the Deputy Chief Executive Officer (Ms Sharon Christopher) who chaired the committee; the Chief Executive Officer (Mr Larry Nath); and the lead broker, First Citizens Brokerage & Advisory Services (FCBAS, a wholly-owned subsidiary), along with other members from the Divestment Secretariat MoF and PwC etc.
FCB's 2013 Annual Report (AR) at page five lists Nyree D Alfonso (Chairman), Sharon L Christopher, Larry Nath, Shobee Jacelon, Marlene Juman, Ved Seereeram and Anil Seeterram as the FCBA board of directors. Incidentally, all are also directors on the board of the parent company, FCB.
Moreover at page 31 of the AR, it states inter alia: "the First Citizens Board acknowledges and understands that it has ultimate responsibility for ensuring and providing oversight for the effectiveness of the overall compliance and risk management and control framework and policies for the First Citizens Group. To this end, the Board established a subcommittee–the Board Enterprise Risk Management Committee."
And at page 45, the AR further states: "In fulfilling its mandate, the Committee, through the Group Chief Risk Officer, has oversight of the Group's Market Risk, Operational Risk and Compliance Units..." This is important because it establishes that the Board was aware of its overarching responsibility to mitigate any real or potential risks (particularly reputational risk) that could negatively impact the bank, notwithstanding any recommendation(s) of the MoF.
But more importantly it establishes that the Board may have exercised poor judgment in delegating this weighty responsibility to one individual, in the person of its former Group Chief Risk Officer, Mr Rahman.
It also establishes that at all material times there were at least six Board members who were indirectly connected with, and at least three of them who would have been directly involved in, the IPO process, and two of whom would have been close colleagues of Mr Rahaman on the bank's Executive Management Team.
Barring any further revelations, the bottom line for me has never been whether the directors broke any laws or did anything illegal; but simply based on the many unanswered questions coupled with the unfortunate, crass and premature utterances of the chairman buttressed by the acquiescence of Board, a significant number of the citizens/customers have lost confidence in them, in very much the same way that the Board itself had lost confidence in its former group chief risk officer even if the reasons might be slightly different. In other words, they cannot have it both ways: what is good for the goose surely must be good for the gander.
Accordingly, I wish to reaffirm my confidence in FCB as a financial intuition and just as I had done in the case of Mr Ramkhelawan, I am hereby calling on each director of the FCB Board to place the interests of the institution above their own, by doing the honourable thing forthwith.
Peter Permell
Minority shareholders advocate