C.L. Financial Bailout – Turmoil, Instability and Unanswered Questions

CL Financial bailout – The Governor speaks

by Afra Raymond

My last column on this important matter was published on 31st December, almost a month ago, with several major developments since then.  The main development in my view is that we had some truly remarkable statements from the Governor of the Central Bank.

The messages on the CL Financial group are now so confused that the most charitable phrase possible, is that the public is getting ‘mixed messages’.

The Top-level resignations – The group CEO, Steve Bideshi – a former senior manager at Citigroup – was reported on 12th January to have tendered his resignation, effective 31st January.  (See – Bideshi quits CL after 6 months or Trinidad Express article here)

We are told that his reason for resigning is the breakdown of negotiations for his compensation package.  Our governments have a serious track-record of agreeing and then secreting the terms of compensation for its high-fliers.  Just think of Caribbean Airlines, PetroTrin and UdeCOTT.  It is unbelievable that government was unable to agree terms with this one CEO.  Arguably, Mr. Bideshi was heading the largest and most complex group within the State’s control.

On 19th January, we were told that Michael Carballo, the group Finance Director, was resigning, also effective 31st January.  (See – Guardian’s Another executive leaves CL Financial or Trinidad Express article here)

Carballo had the unique position of being the only senior executive to survive the crisis at the group and keep his position.  We were not given any reason for his departure, but we were told that Carballo is to continue acting as a Director on CL Financial’s Board.

Bideshi and Carballo were the two top executives at CL Financial.  What is going on?

To date there has been no proper explanation as to the causes of these major resignations or clear statement on the way forward.  To have both the group CEO and Finance Director resign within a week of each other, effective within less than a month, speaks of turmoil and jostling.  That kind of thing would not happen if the situation was stable.  The purpose of this bailout was said to be the avoidance of systemic risk and the maintenance of confidence in our financial system.  The official silence on this startling development only adds to the impression of ‘more in the mortar than just the pestle’.

… continue reading the full article at Afra Raymond’s blog article CL Financial Bailout – The Governor Speaks

2 Comments

Filed under Barbados, Business & Banking, Consumer Issues

2 responses to “C.L. Financial Bailout – Turmoil, Instability and Unanswered Questions

  1. Donald Duck, Esq

    Wasn’t it strange to hear cbc tv announce the 2008 results of clico life last night.

  2. Donald Duck, Esq

    CBC reported the following on its web iste for september 23 2009

    “Reports reaching the CBC are that the Chairman of CLICO Holdings will be retiring from that organisation at year end.

    While we have not yet been able to reach Mr Parris for comment … CBC understands that he has made his intentions known at a board meeting last Monday.

    He has spent 30 years with CLICO Holdings moving its asset base from two million dollars to one point four billion dollars, and he has also been responsible for the development for all the subsidiaries of CLICO holdings.”

    If he was supposed to have retired why then did he sign approving the 2008 balance sheet of clico life as at January 27, 2010