Hand-in-Hand set to take over GNCB Trust
Stabroek News
November 28, 2002
Arrangements are in place for Hand-in-Hand Insurance Company to take over the state-owned GNCB Trust Corporation on Middle Street next week.
Hand-in-Hand had offered US$2.3M for a 90% stake of the Trust’s share capital, which at December 31, stood at G$250M.
The bid was approved by Cabinet in March with the remaining 10% stake reserved for an employee share option plan.
Hand-in-Hand, which has been in the insurance business for more than a hundred years, was also the successful bidder for the Guyana Co-operative Insurance Service. Hand-in-Hand has reportedly applied for a banking licence but Stabroek News was unable to ascertain the status of the application either with the Bank of Guyana which is the issuing authority or with Hand-in-Hand.
Patrick Yarde, President of the Guyana Public Service Union, which represents the employees of GNCB Trust, told Stabroek News that the union had reached an agreement in principle with the Privatisation Unit on a termination package for the workers.
He said the Privatisation Unit had also undertaken to ensure that as many of the workers as possible are retained when the entity changes hands. Stabroek News has since learnt that initially all of the Trust Company’s staff will be retained.
GNCB Trust Company’s net income at December 31, 2001 was $17M, an increase of $10.5M over the previous year. Its gross income was $480M, which was $16.3M less than the previous year and its expenditure of $456.1M was $22.8M less than the previous year. Its loan loss provisioning at December 31, 2001 was $106M $3.8M higher than the previous year.
Its assets are listed as $3.8B ($3.4B in 2000) which includes investments of $2.9B ($2.6B in 2000). Its liabilities are listed as $3.1B ($2.7B in 2000) which include customers deposits of $2.9B ($2.5B in 2000).
Shareholders equity totalled $711.2M ($694.2M in 2000) at December 31, 2001.
The shareholders’ equity last year included $123.3M ($108.8M in 2000) on retained earnings, $40.8M ($38.2M in 2000) as a reserve fund and $297.2M ($297.2M in 2000) as the revaluation reserve.
Negotiations for GNCB to conclude by end of March
Negotiations for the sale of the Guyana National Co-operative Bank (GNCB) at a price of $2.7B are expected to conclude by the end of the first quarter next year.
This was disclosed yesterday in a joint press release from the Privatisation Unit/GNCB and the National Bank of Industry and Commerce Limited (NBIC) which confirmed that the deposit agreement for the purchase of the bank by NBIC was signed on Tuesday. Michael Archibald, Managing Director of NBIC signed for his bank while Winston Brassington, Executive Secretary and Head of the Privatisation Unit appended his signature on behalf of the government and Mohammed Sattaur, Chairman of GNCB did the same for GNCB.
The release said that NBIC has offered US$14,102,564 (approximately $2.7B) for GNCB and it noted that the business of GNCB includes a guaranteed net asset position of $2B.
Noting that the purchaser is a subsidiary of Republic Bank Limited, a leading Caribbean bank, the release said “depositors of GNCB can feel assured for the security and safety of their deposits”.
It added that both the Privatisation Unit/GNCB and NBIC “recognise the importance of the welfare of the employees of GNCB and will work closely to ensure a smooth transition as the two organisations merge”.
