A SUBSIDIARY of Guardian Holdings Ltd is to acquire the insusrance and annuities business of NCB Insurance Company, as the NCB Financial Group (NCBFG) moves to streamline its insurance business in Jamaica.
NCBFG acquired a majority 62 per cent stake in Guardian Holdings last year and owns 100 per cent of NCB Insurance Company.
In a statement released on the T&T Stock Exchange last Thursday, NCBFG said it has submitted to Jamaica’s financial regulator, the Financial Services Commission, to transfer 100 per cent of NCB Insurance Company’s portfolio of insurance and annuities business to Guardian Life Ltd. GLL is a 100 per cent subsidiary of Guardian Insurance Ltd incorporated in T&T, which is in turn a wholly owned subsidiary of Guardian Holdings Limited.
NCBFG also applied to Jamaica’s financial regulator for NCB Insurance Company to be licensed as a dealer under Jamaica’s Securities Act and for the company to be registered as an insurance agent under the country’s Insurance Act.
A spokesperson for the Kingston-headquartered financial services group confirmed that Guardian Holdings would pay a consideration for the transfer of NCB Insurance Company’s insurance and annuity business.
She said NCB Insurance Company’s assets as at December 2019, were valued at approximately US$410 million.
On Monday, group CEO of Guardian Holdings Ltd, Ravi Tewari, confirmed that the Westmoorings-headquartered financial services company is purchasing the NCB Insurance Company insurance and annuity portfolio.
“We have commissioned an independent valuation which will form the basis for arms-length negotiations.
“The independent valuation is being performed by EY and by Eckler Consultants. Once we have agreed on the consideration I will be happy to share it with the public.”
Responding to questions from Jamaica’s Financial Gleaner, NCBFG’s deputy CEO, Dennis Cohen, declined to disclose the price that GHL would have to pay for the assets.
“The transaction will be at arm’s length, the details of which I can’t get into now because there are actuarial considerations.
“Suffice it to say while there will be a transfer of some assets, Guardian will effectively take on liabilities in taking on the portfolio,” Cohen told the Financial Gleaner.
Guardian Life is the second largest life insurance company in Jamaica, after Sagicor.
Only last week, Sagicor said it would no longer continue to pursue the acquisition of Scotiabank’s T&T insurance company, after a similar proposed acquisition of Scotiabank’s Jamaican insurance company fell apart last November.
NCBFG’s purpose for transferring the assets “is to strengthen its Jamaican insurance portfolio and optimise its product and service offerings and customer experience”.
Patrick Hylton, who is Group CEO at NCBFG and chairman of GHL, said of the transaction: “We recognise that while each entity has delivered strong performance results, having competing entities within the same Group of companies has resulted in missed opportunities to collaborate and leverage economies of experience and scale that could positively benefit each entity’s customers and performance.
“As we adapt to doing business in the ‘new normal’, companies must take every opportunity to optimise employee and customer experiences, operating efficiency and shareholder value to maintain their viability.”