Board did no wrong

Finance Minister Larry Howai yesterday made it clear that the Corporation Sole’s vote against the re-election of two First Citizens Bank (FCB) directors and lack of support for the re-election of two others, including chair Nyree Alfonso, was not due to the fact that they had done any wrong.

He made the comment yesterday as speculation swirled over whether Alfonso and other directors Rishi Baddaloo, Shobee Jacelon and Marlene Juman, the permanent secretary in the Ministry of the Attorney General, had been told not to seek re-appointment at Monday’s AGM for their role in overseeing the now controversial IPO share sale. Speaking to the media at the Energy Chamber’s Corporate Governance Toolkit Launch at the Hyatt Regency Hotel, Port-of-Spain, yesterday, Howai assured this was not so.

“We did say that this was not intended to impute any wrong doing on the part of anyone,” Howai said. “The Corporation Sole felt that there was a need to make changes in light of some of the concerns being expressed and we simply proceeded on that basis. “We are now in the process of looking at some possibilities in terms of appointments for the board. We know we must make appointments that will engender confidence in the institution and allow the institution to build into the future.”  

During Monday’s AGM at the National Academy for the Performing, Vishnu Dhanpaul, the permanent secretary in the Ministry of Finance, acting as the representative for the Corporation Sole, said it did not support the re-election of either Alfonso or Baddaloo and voted against the re-appointment of Juman and Jacelon.

Yesterday there was public debate over whether the manner in which the Corporate Sole went about the process was professional, noting the public embarrassment to the board members would not engender any more public confidence in the bank’s governance structure. Yesterday, however, Howai called the officers of the Ministry of Finance “professional.” “They do their evaluation and make their decision and you get your approvals and move forward,” he said.

On the way forward for First Citizens, Howai said they were speaking to “a few individuals” at this stage to identify replacements for the board. Howai also admitted that although the FCB IPO was a success, it was eventually “tainted”. “It has been very successful and it continues to meet a strong and well capitalised institution and very profitable,” Howai said.

“The IPO was a success but it became affected and perhaps tainted by some of the activities that seem to have taken place. We are still waiting on the results of the Securities Exchange Commission (SEC) Review and investigation which is ongoing now and when it comes out then it will be determined how one proceeds.” The SEC is currently investigating the sale of 659,588 shares to then First Citizens executive Philip Rahaman at a cost of $14.5 million. 

Future IPOs have since been put on hold in the wake of the First Citizens IPO so that processes can be reviewed.