Dr Euric Bobb, outgoing chairman of Clico, described 2009 as a year of "survival" for the company.
"Last year was a period of consolidation and survival for Clico. We found a company that was totally in distress. It took us almost 12 months to get audited financial accounts," Bobb said. He said the company contravened the best practice for accounting used in companies. "Simple controls and processes were not there. This is a multi-million-dollar company that had not reconciled, for example, had not reconciled bank accounts for three years. We had to start doing that. "If you ever try to reconcile your personal bank account after a lapse of 12 months, you could understand what it means to reconcile bank accounts for a large company over three years, and that is just one example," Bobb said. Bobb made his statement at a news conference to announce the appointment of Marlon Holder, former executive director, Unit Trust Corporation, to the position of chief executive officer and managing director of CL Financial Group and chairman of Clico, yesterday.
"There was no audit committee. There was a board prior to the board installed by the Central Bank that had only one non-executive director. Governance was an alien term in that environment," Bobb said. He said the last year was "spent restoring some of the basics of the checks and balances of the risk management and so on that you expect to find in any well-managed enterprise." Bobb said all the accomplishments were made when "there was legitimate clamour of people with maturing executive flexible premium accounts to have their money, in a situation where the company simply did not have the cashflow, and even with the support of the Government, you will understand in the first few months, advances of over $1.9 billion dollars. It wasn't until January 2010 before we got further advances from the Government.
"The board and management of Clico had to work very hard in keeping the cashflow in some balance. And, in addition, to the funding from the Government and some contribution from our normal operation–a large part of closing the financial gap had to do with getting the confidence to have a signifcant rollover of maturing deposits some where around 65 per cent," Bobb said. Responding to the statement that Clico puts salaries above other commitments, Bobb said this is not so. "It's unfair when people throw around rumour that underminds the self-confidence of people who are trying to do a good job," Bobb said.