First Cit­i­zens chair Nyree Al­fon­so yes­ter­day came to the de­fence of a se­nior of­fi­cer of the ma­jor­i­ty state-owned bank, whose pur­chase of 659,588 shares dur­ing last year's ini­tial pub­lic of­fer­ing (IPO) has been ques­tioned in some quar­ters of the pub­lic.Phillip Ra­haman, First Cit­i­zen's Group chief risk of­fi­cer, spent about $14.5 mil­lion to ac­quire the shares, which were list­ed on the lo­cal stock ex­change on Sep­tem­ber 6 last year, ac­cord­ing to the dis­clo­sure made in the bank's 2013 an­nu­al re­port.Gov­ern­ment last year di­vest­ed 19.3 per cent of its stake in the bank, equal to 48.5 mil­lion shares, to em­ploy­ees of the bank, in­di­vid­ual in­vestors, lo­cal fi­nan­cial in­sti­tu­tions and com­pa­nies.Of the 48.5 mil­lion shares, 15 per cent were al­lo­cat­ed to em­ploy­ees of the bank, who on­ly took up half of their al­lo­ca­tion, even though they were al­lowed to buy up to 5,000 shares at a ten per cent dis­count of the of­fer price, which was $22 a share.

The num­ber of shares pur­chased by Ra­haman was more than three times greater than shares pur­chased by any oth­er ex­ec­u­tive or di­rec­tor of the bank.In a state­ment sent to the T&T Guardian yes­ter­day, mi­nor­i­ty share­hold­er ac­tivist Pe­ter Per­me­ll called on the bank "to clear the air on this par­tic­u­lar trans­ac­tion as fail­ure to so do would in­vite un­nec­es­sary spec­u­la­tion and has the po­ten­tial to erode con­fi­dence and trust in se­nior man­age­ment. Si­lence is not an op­tion."Op­po­si­tion leader Dr Kei­th Row­ley al­so told a ra­dio sta­tion that giv­en the sub­sidy on shares sold to the em­ploy­ees, the Gov­ern­ment had a re­spon­si­bil­i­ty to clear the air.But Al­fon­so de­scribed the com­ments as a "po­lit­i­cal storm in a teacup."Al­fon­so, who is a prac­tis­ing at­tor­ney, said she was con­fi­dent there were no breach­es of reg­u­la­tions, poli­cies or pro­ce­dures in the se­nior ex­ec­u­tive's pur­chase of the shares worth $14.5 mil­lion.She said: "I am so con­fi­dent that I am will­ing to take a deep dive in­to the process. The bank has noth­ing to hide in terms of how this process was run. I will stake my con­fi­dence in the way the bank ran the process, which was trans­par­ent, fair and unas­sail­able."The pur­chase of the shares is per­fect­ly le­git­i­mate, in that it breach­es no part of the al­lo­ca­tion pol­i­cy giv­en to us. It does not breach any reg­u­la­tions of the Se­cu­ri­ties and Ex­change Com­mis­sion. It does not breach any Stock Ex­change reg­u­la­tions and it does not breach any in­ter­nal poli­cies or pro­ce­dure of the bank."It is from those fac­tors that I draw the con­clu­sion and am of the view that it is a per­fect­ly le­git­i­mate trans­ac­tion."

Ques­tioned about the strict an­ti-mon­ey laun­der­ing con­trols that banks are re­quired to im­ple­ment, Al­fon­so said the bank did re­view the ex­ec­u­tive's source of funds both at the ap­pli­ca­tion stage and sub­se­quent­ly. "The bank sat­is­fied it­self about the sources of funds and I can say that he did not re­ceive any mon­ey from First Cit­i­zens, which is in keep­ing with our pol­i­cy, which pro­hib­it­ed man­agers from ac­cess­ing the ze­ro per cent in­ter­est loans that were of­fered to em­ploy­ees to pur­chase the shares," she added.On the is­sue of whether the al­lo­ca­tion pol­i­cy should have capped the num­ber of shares that em­ploy­ees were en­ti­tled to ap­ply for, the bank's chair ques­tioned the le­gal­i­ty of such an ac­qui­si­tion cap.She added that the al­lo­ca­tion pol­i­cy for the First Cit­i­zens' share of­fer would have been ap­proved by the Min­istry of Fi­nance and the SEC and the Stock Ex­change would have had sight of it."The First Cit­i­zens share of­fer was an op­por­tu­ni­ty for the Gov­ern­ment to share its wealth with the pop­u­la­tion. How much you can cir­cum­scribe that op­por­tu­ni­ty?" she asked.Asked whether it was true that Ra­haman had sold his shares at a sig­nif­i­cant prof­it, Al­fon­so said that would have been the se­nior of­fi­cer's pri­vate busi­ness.But she added that there was a 90-day black­out pe­ri­od af­ter the IPO in which no di­rec­tor, or em­ploy­ee or se­nior of­fi­cer was al­lowed to trade in the shares.First Cit­i­zens de­clared an af­ter-tax prof­it of $606.5 mil­lion for the year end­ing Sep­tem­ber 30, 2013. This was an in­crease of $160.1 mil­lion or 35.9 per cent when com­pared with 2012.