NADALEEN SINGH

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.