Archive for May 31st, 2009
CUC raises $40 million
(CUC): Local power company Caribbean Utilities Company, Ltd. (CUC) said on Friday that it now had access to the first tranche of a US$40 million private placement of 7.50% Senior Unsecured Notes which will be due to be paid back in May 2024. The firm said that the debt offering was privately placed with institutional investors in the United States and that the first $30 million will be used to repay short-term debts and to finance ongoing upgrades to CUC’s generation and transmission and distribution system.
“We are pleased to have been able to secure this additional financing on favourable terms at a time when many companies are unable to access growth capital,” said President and Chief Executive Officer, Richard Hew. “CUC’s status as a publicly traded company with a strong debt rating helps secure access to efficient capital markets which enable us to sustain our commitment of over 40 years to reliable and efficient electrical service to Grand Cayman.”
He explained that without access to these sources of capital, CUC would be challenged to make the significant long term capital investments required to meet growth and reliability requirements of Grand Cayman. The completion of ongoing projects such as the Rum Point to Frank Sound transmission loop and the 16 megaWatt MAN Diesel generation capacity expansion, ensure that customers receive reliable service and also help sustain a high standard of infrastructure necessary to support existing industry and attract future development to the island, the CEO added.
CUC said the notes will not be registered under the Securities Act of 1933 (the “Securities Act”) as amended, nor will they be registered under any state securities laws. Unless so registered, the notes may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.
The second tranche of US$10 million is scheduled to close in July 2009 the firm said.
Drop rollover, says Travers
(CNS): In response to direct questions from the new leader of government business about how financial services business activity can be increased, Anthony Travers, the chair of CIFSA, told McKeeva Bush that immediate consideration would have to be given to the application of the rollover policy to professionals in the financial industry. “Whilst there are clear and good reasons to maintain a rollover policy, it is unrealistic to expect that talented professionals in the financial industry will be attracted to the Cayman Islands with the uncertainty of the seven year term,” Travers told the new Leader.
Travers explained the current situation within the financial services sector at a meeting which took place at the Ritz Carlton Grand Cayman on Thursday, 28 May, with LOGB Bush, Chief Secretary George McCarthy, Financial Secretary Kenneth Jefferson, other members of the Cayman Islands Financial Services Association (CIFSA) and industry stakeholders.
Travers said that currently Cayman’s competitors were benefiting from the exodus of fund managers and finance professionals from the United Kingdom and other G20 countries, while Cayman itself was not. “There was no concern that justified the application of the rollover policy to highly talented professionals with qualifications and indeed, by doing so, there is clear evidence that fund administration business has moved out of the Cayman Islands and that job opportunities for young Caymanians have, as a result, been significantly reduced,” he added.
The CIFSA Chair also told Bush and the other ministers that the application of appropriate regulation could not be used as an excuse to delay an immediate response time from the Cayman Islands Monetary Authority with respect to new financial activity licensing. He said that with the decline in the volume of transactional flows, nothing had been done to effectively develop alternative strategies.
“The inescapable conclusion for Cayman is that higher quality infrastructure has to be attracted to the Islands and the issue of immigration and the speed of the licensing process are central to the success of that objective,” Travers explained, adding that another immediate problem was the failure to attract a genuine financial infrastructure to Cayman. He explained that this was playing into the hands of the argument that there is a “lack of substantial activity” in the Cayman Islands, a core feature of the OECD attack on tax havens.
“Without introducing a radically revised approach to attracting fully staffed financial service companies, the ‘18,000 company in one building’ point which has regrettably been allowed to gain traction, translates into a major and unanswerable plank of the OECD’s anti offshore financial centre policy,” Travers added.
At the meeting Bush outlined his proposals for a delegation to visit representatives of the British Government in London with a view to resolving immediately the issue of the additional bilateral treaties to secure inclusion on the OECD White List. The LoGB also said he would restore the relationship between government and the private sector in relation to the financial services industry and indicated that he would be establishing a small financial services committee which he would chair personally and pledged to hold regular quarterly meetings with a reconstituted Private Sector Consultative Committee, which would include the major participants represented.
McCarthy told the CIFSA representatives that he had had valuable conversations with Jeffery Owens of the OECD, and said he would be leading an immediate initiative to secure the execution of additional bilateral treaties. Jefferson also assured the private sector that there was no current intention to increase fees on the financial industry.
Travers welcomed the comments from the ministers and indicated that CIFSA would certainly use its best endeavours to provide government with all relevant information on the basis of which it could determine a pro-active policy.
Travers warned, however, that there were dark forces at work and that he saw in the current initiatives a re-introduction of the original principles which underlay the 1997 OECD Report on Harmful Tax Competition, which was a thinly veiled attempt by the G20 countries to impose monopolistic control over all international financial services. “It would be naïve to believe that the OECD would not shift the goal posts once again in pursuit of their ultimate objective,” Travers added.
Baines takes up top cop reins
(CNS): Having arrived on island last week, the new permanent commissioner of police, David Baines, takes up his post today (Monday 1 June) following the departure of Acting Commissioner James Smith. Baines said when he arrived that he was under no illusions about the scale of the job but he was looking forward to it, while the departing Smith said he hoped he had at least addressed some of the issues before he left.
“It is with regret that I am leaving the RCIPS this week. I arrived during an unsettling time for officers and staff and I leave hoping that I managed to ease some of the issues beingfaced by the Service as a whole and by some individuals. During my time here, I have been extremely impressed by the resilience, dedication and commitment of staff who work in a very demanding environment. There are still challenges ahead, and I wish everyone I have worked with the very best for the future as the Service continues to grow and develop,” added Smith, who was unsuccessful in his application for the top cop post for a second time as he had also been beaten out in 2005 by former Commissioner Stuart Kernohan.
Smith arrived in Cayman in December of last year following the sudden departure of Royce Hipgrave, who served as acting commissioner for less than 48 hours. It is understood he was not fully informed of the situation regarding the Special Police Investigation Team (SPIT) until he arrived on island and it is also believed he had concerns about the lack of full indemnity insurance for senior officers serving in the RCIPS.
Baines, who will be the sixth person to take up the post in less than fifteen months, has come to the Cayman Islands from his postas Assistant Chief Constable with the Cheshire Constabulary and he said he was going to do his best to take things forward and improve policing in Cayman. “I am looking forward to making a difference to people’s lives,” he told CITN. “I had a fairly limited introduction to the islands when I came during the selection process, but what I did find was a lot of really keen people anxious to do a good job and desperate to improve and put the problems that have besmirched the name of the RCIPS behind them.”
Baines will now be taking up the responsibility for the special police investigation and will also have to deal with the legal action filed by Campbells regarding the suspension and dismissal of the former Commissioner Stuart Kernohan and the alleged unlawful arrest of former police inspector Burman Scott.
Although Smith had known SIO Martin Bridger, the former metropolitan police officer who was heading up SPIT, from the UK, he did instigate Bridger’s departure from the island at the behest of the previous administration. However, he also initiated the so-called second phase of the special investigation, which he named Operation Cealt, which is reportedly investigating allegations and information that was given to SPIT over the last 18 months regarding alleged corruption in the RCIPS. The new SIO of that investigation is Anne Lawrence, but Baines will still remain in charge of SPIT as they have all been sworn in as special constables.