Issuu

business@tribunemedia.net

TUESDAY, NOVEMBER 14, 2017

$4.25

$4.29

Gov’t ‘increasing risk’ via $800m borrowing By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

he Government faces “increased risk” by issuing an $800 million US dollar bond, a former finance minister yesterday suggesting it instead target $1.7 billion in local excess liquidity. James Smith, who ran the Ministry of Finance from 2002-2007, told Tribune Business there was a strong argument for first “mopping up” the surplus assets in the Bahamian commercial banking system before borrowing on the international capital markets. He explained that this would encourage Bahamian banks to increase the near-rock bottom deposit rates that have been “punishing savers”, and “relieve pressure” on the sector caused by an inability to find new lending opportunities and qualified borrowers. Conceding that the former Christie administration may have “made a mistake” with its foreign currency borrowings, Mr Smith reiterated that the Bahamas needed to keep such debt - as a percentage of the total - “as low as possible” to minimise pressure on the external reserves. He added that the Government would find it much easier to negotiate a debt restructuring, should it

* Should ‘mop up’ $1.7bn local liquidity first * Could boost deposit rates, ‘relieve’ bank pressure * Christie Gov’t ‘made mistake’ doing same become necessary, if the vast majority of its creditors were Bahamian, and warned that increased foreign currency debt servicing costs could “crowd out” essential imports. Mr Smith acknowledged that his views should be treated with “caution” as the rationale for the Government’s planned foreign currency borrowing is currently unknown, and he recalled how such moves were “well thought-out” when he led the Ministry of Finance. However, with the Bahamas still struggling to get its deficit and national debt under control, the Minnis administration’s decision to tap the international capital markets for such a large debt facility has surprised many observers. The latest data from the Central Bank shows that excess commercial JAMES SMITH

SEE PAGE 3

$4.29

Investors ‘amazed’ over BOB’s first profit in 5 years By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net BANK of the Bahamas (BOB) “amazed” its shareholders yesterday by declaring its first quarterly profit in almost five years, following its $162 million summer ‘bail-out’. The stricken BISXlisted institution produced $838,261 in total comprehensive income for the three months to end-September 2017, indicating that the shedding of many toxic commercial loans is already paying off. A 63.7 per cent yearover-year reduction in loan loss provisions, from $4.387 million to $1.59 million, was largely responsible for BOB’s first quarter ‘in the black’ since the three months to end-December 2012. The near-$3 million provisioning decline, produced

* BAIL-OUT DRIVES $838,261 NET INCOME FOR Q1 * BUT SHAREHOLDERS KNOW LONG ROAD AHEAD * ‘DISGRACE’ NO ONE YET HELD ACCOUNTABLE by the ‘toxic’ credit transfer to the Bahamas Resolve ‘bail-out’ vehicle, helped drive a $4.217 million turnaround from the $3.379 million loss that BOB endured for the three months to end-September 2016 Some of BOB’s minority investors, unaware of the bank’s latest results release, were left stunned yesterday when Tribune Business informed them that the first quarter for its 2018 financial

SEE PAGE 4

Bahamas must ‘get PM: 2022 for Gov’t across line’ on tax accounting switch automatic exchange By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Government has been urged to “get across the line before year-end” on global tax information exchange standards, amid hope the relevant legislation will reach Parliament tomorrow. Michael Paton, a former Bahamas Financial Services Board (BFSB) chairman, told Tribune Business that the Bahamas needed to upgrade its existing legislation to facilitate its switch to sharing tax information on a multilateral - rather than bilateral - basis. Given the heightened scrutiny being

* INDUSTRY WANTS LAW CHANGES ‘BEFORE YEAR-END’ * FACILITATING SWITCH TO MEET MULTILATERAL DEMANDS * GOV’T ASSURES BILLS TO REACH HOUSE THIS MONTH applied to international financial centres (IFCs) in the wake of the so-called ‘Paradise Papers’ revelations, Mr Paton said that meeting the Bahamas’ commitments to the international community had assumed extra importance. The Lennox Paton law firm partner said: “We expect to have the amending Bills tabled in Parliament. My

understanding is those are virtually ready to go, and we need to get these across the line before the end of the year. “Hopefully it gets on the agenda this week or the week after. This is the switch from bilateral to multilateral, so we’re making technical amendments to enable

SEE PAGE 2

By NATARIO MCKENZIE Tribune Business Reporter nmckenzie@ tribunemedia.net

* MOVE TO ACCRUAL BASIS ‘NO SMALL FEAT’ * SETS 2023 FOR FULL DEPLOYMENT * CONFIRMS CURRENT SET-UP INADEQUATE

THE Prime Minister yesterday revealed that the Government is targeting end-June 2022 to fully switch to accrual-based accounting, describing the move as “no small feat”. Dr Hubert Minnis, giving the opening address at the Bahamas Institute of Chartered Accountants’ (BICA) Accountants Week, added that 2023 was the timeline for rolling-out the accounting system to the wider public sector beyond central government. He acknowledged that the Government’s current cash-

based accounting system was “woefully lacking” when it came to providing a complete and accurate view of the Government’s financial position, activities and performance. “As policymakers we value the importance of financial reporting that meets international standards. It is essential that we are in a position to utilise high-quality information to make informed and sound spending decisions, while properly managing our assets and our liabilities,” said Dr Minnis. The Government currently operates a

cash-based accounting system, which only recognises revenues when they come in, and expenditures when they become due for payment. An accrualbased system will give a more accurate picture of the Government’s finances, as it will also recognise expenditures for which future commitments have been given, but monies not yet released. Dr Minnis said the process towards moving to an accrual system was initiated by the former Christie administration during the

SEE PAGE 2

Businesses hit by Post Office ‘disaster’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net BAHAMIAN businessmen yesterday warned that the Post Office “disaster” continues to impact private sector cash flows and the smooth conduct of commerce. Speaking as Post Office staff conducted a protest outside their East Hill Street headquarters over working conditions, senior private sector executives said delays in clients receiving invoices/bills were contributing to the build-up of accounts receivables. Francisco de Cardenas, Bahamas Waste’s managing director, told Tribune Business that the $2.374 million accounts receivables at end-September 2017 were one of the few issues facing the BISX-listed company. “We’re having a bit of a challenge with our

A VIEW of the Post Office on East Hill Street, New Providence. receivables, and I can’t believe not one word is being said about the Post Office,” he told Tribune Business. “I think it’s a huge detriment to the economic mechanisms of this country. “People send bills and make payments through the Post Office, and it’s a disaster. No one is saying anything. I don’t understand it. I can only assume

it’s affecting everyone in business. Not everyone banks by Internet; not everyone has a messenger. It’s been going on probably a good year.” Mr de Cardenas’s concerns were echoed by Robert Myers, Caribbean Landscaping’s principal, who said the cash flow issues caused by the Post Office’s woes were

having a knock-on impact were Value-Added Tax (VAT) was concerned. “It is creating a lot of difficulties for business as they cannot depend or rely on mailing out invoices and statements,” Mr Myers told Tribune Business. “The problem we have sometimes is that our clients are elderly - not many, but some - and they don’t have e-mail or the capacity to log-on to a website for an electronic statement. “It’s causing problems with regards to our cash flow that the Inland Revenue Department and VAT Office don’t care about. What we’re having to do is call people and say: ‘What’s happening’, and they say they’ve not received their bill/invoice. We ask if we can fax or e-mail it. “It’s causing a lot of extra work, and in many cases

SEE PAGE 4

PAGE 2, Tuesday, November 14, 2017

THE TRIBUNE

Bahamas must ‘get across line’ on tax automatic exchange FROM PAGE 1 multilateral [information sharing], and amending the international tax co-operation legislation to enable the Bahamas to enter into the Multilateral Competent Authority Agreement.” That Agreement provides a standard international mechanism and framework for the automatic exchange of tax information, while the Bahamas also has to sign the Mutual Assistance on Tax Matters convention as part of complying with the Organisation for Economic Co-Operation and Development’s (OECD) Common Reporting Standard (CRS). Mr Paton explained that the Competent Authority Agreement dealt with the technical aspects of tax information exchange, while the convention was a treaty that allowed the Bahamas to determine which of 106-108 countries it will “exchange information with on an automatic basis”. “It basically puts the Bahamas in position to fully automatically exchange tax information, starting next year,” he added of

the anticipated legislative package. “There’s going to be a lot of technical stuff moving across the legislative agenda in the next few weeks.” Tanya McCartney, the BFSB’s chief executive, told Tribune Business that the Government had informed the financial services industry that the necessary CRS-related legislation will be tabled in the House of Assembly this month. “We got an update that Parliament is to review updates to the automatic exchange legislation in the month of November,” she said. “We hope it will be this week, but certainly in November, and also the guidance note will be finalised in the month of November. “We are waiting to hear from the OECD on our request to accede to the Convention. We have done what we need to do, but there is a process associated with that, and we were assured by the Government they are going through that process. “BFSB is actively engaging with the Government to ensure as a jurisdiction we are proactive, and taking all steps necessary to assure these global entities that

Legal Notice

the Bahamas is committed to complying with the required standards and best practices.” The Bahamas had initially sought to comply with the OECD’s CRS, the global standard for automatic tax information exchange, via a bilateral approach that would have involved sharing details on a country-by-country basis. However, it came under heavy media and international pressure, inspired by the OECD and its surrogates, to switch to the multilateral approach which involves information exchange with all-comers. The Bahamas was also left exposed by the likes of Hong Kong, Singapore and the United Arab Emirates (UAE) switching from the bilateral to the multilateral method, resulting in this nation being branded the global ‘holdout’ amid thinly-veiled ‘blacklisting’ threats by the European Union (EU) and OECD. The former Christie administration left the decision to its successor, and one of the new government’s first actions was to inform the OECD that the Bahamas, too, would move to the multilateral approach.

PM: 2022 for Gov’t accounting switch FROM PAGE 1 2015-2016 fiscal year, with a Government working group producing a paper outlining the road map for accrual accounting implementation. “Moving to accrualbased accounting will ensure greater transparency and accountability in public sector finances, as well as a better monitoring of government debt and liabilities. The potential harm of the absence of these prudent practices was exposed in our recent assessment of the fiscal outcome for the year 20162017. As we now know, high levels of unbudgeted expenditure are poised to elevate the actual fiscal deficit some five times higher than originally budgeted,” said Dr Minnis. “With the assistance of the IMF we are making progress towards finding a sound framework that will include controls of certain

Legal Notice

recurrent expenditures, taking more decisive steps with pension reforms and better managing subsidies to our state-owned enterprises.” The need for government accounting reform was highlighted in the wake of the May 10 general election and subsequent 2017-2018 Budget, when the newly-elected Minnis administration revealed that the prior year’s deficit was expected to come in at $500 million. This was five times’ the Christie government’s original $100 million estimate, and some $150 million more than its revised post-Hurricane Matthew forecast of $350 million, given just two months before the May Budget. It subsequently emerged that the Minnis administration’s figures, and subsequent $695 million deficit estimate, had been produced by switching the Government’s accounting method to the accrual basis.

Moody’s, the credit rating agency, later reported that the Government’s deficit would have come in close to the Christie administration’s projected $350 million had cash-based accounting been retained, sparking political controversy between the two major parties. Dr Minnis noted that transitioning to accrual based accounting is no small feat. “Transitioning public financial reporting to accrual based accounting is no small feat. We have targeted a date of end of June 2022 for full central government transition to accrual accounting and 2023 for the public sector at large.” Dr Minnis noted that based on regional and and international experience, the lack of adequate technical resources can be a major setback to the successful implementation of accrual accounting in the public sector.

Legal Notice

NOTICE

INTERNATIONAL BUSINESS COMPANIES ACT (No. 45 of 2000)

WILSHIRE INVESTMENTS INTERNATIONAL LTD.

MANHATTAN INVESTMENTS HOLDING LTD.

TULAROSE PROPERTIES LIMITED

In Voluntary liquidation

Notice is hereby given that in accordance with Section 138 (4) of the International Business Companies Act (No. 45 of 2000), WILSHIRE INVESTMENTS INTERNATIONAL LTD., has been dissolved and struck off the Register according to the Certificate of Dissolution issued by the Registrar General on the 31st day of October, 2017.

Notice is hereby given that in accordance with Section 138 (4) of the International Business Companies Act (No. 45 of 2000), MANHATTAN INVESTMENTS HOLDING LTD., has been dissolved and struck off the Register according to the Certificate of Dissolution issued by the Registrar General on the 31st day of October, 2017.

Roshan A Noronha, P.O. Box SS5382, #21 Montaque Heights, Nassau, Bahamas Liquidator

NOTICE International Business Companies Act No.45 of 2000

In Voluntary liquidation

Notice is hereby given that in accordance with Section 138 (4) of the International Business Companies Act (No. 45 of 2000), TULAROSE PROPERTIES LIMITED, has been dissolved and struck off the Register according to the Certificate of Dissolution issued by the Registrar General on the 27th day of October, 2017.

ROCKWELL LTD., of 25 Mason Complex Stoney Ground, The Valley, British Anguilla Liquidator

NOTICE International Business Companies Act No.45 of 2000

RIG Global Select (RGS) – The Argentine Fund Ltd.

Phoenix Investment Fund Inc. (the “Company”)

(the “Company”)

Notice is hereby given that, in accordance with Section 138 (8) of the International Business Companies Act, No.45 of 2000, the Dissolution of RIG Global Select (RGS) – The Argentine Fund Ltd.*. (IBC No. 133576 B) has been completed, a Certificate of Dissolution has been issued and the Company has therefore been struck off the Register. The date of completion of the dissolution was the 2nd day of November, 2017.

Notice is hereby given that, in accordance with Section 138 (8) of the International Business Companies Act, No.45 of 2000, the Dissolution of Phoenix Investment Fund Inc. (IBC No. 158647 B) has been completed, a Certificate of Dissolution has been issued and the Company has therefore been struck off the Register. The date of completion of the dissolution was the 1st day of November, 2017.

Michael Andrew Frank Ingrey Liquidator

Ezio Cardoso Da Fonseca Junior Liquidator

NOTICE International Business Companies Act No.45 of 2000

Legal Notice

NOTICE

Rig Global Select Latin American Fund Ltd.

INTERNATIONAL BUSINESS COMPANIES ACT (No. 45 of 2000)

Notice is hereby given that, in accordance with Section 138 (8) of the International Business Companies Act, No.45 of 2000, the Dissolution of RCP INVESTMENTS LTD. has been completed, a Certificate of Dissolution has been issued and the Company has therefore been struck off the Register. The date of completion of the dissolution was the 1st November, 2017.

Notice is hereby given that, in accordance with Section 138 (8) of the International Business Companies Act, No.45 of 2000, the Dissolution of Rig Global Select Latin American Fund Ltd.* (IBC No. 121251 B) has been completed, a Certificate of Dissolution has been issued and the Company has therefore been struck off the Register. The date of completion of the dissolution was the 2nd day of November, 2017.

Notice is hereby given that in accordance with Section 138 (4) of the International Business Companies Act (No. 45 of 2000), SUNRAY INVESTMENTS LTD., has been dissolved and struck off the Register according to the Certificate of Dissolution issued by the Registrar General on the 31st day of October, 2017.

Luciane Ribeiro Moreno Liquidator

Michael Andrew Frank Ingrey Liquidator

RCP INVESTMENTS LTD. (the “Company”)

(the “Company”)

SUNRAY INVESTMENTS LTD. In Voluntary liquidation

Roshan A Noronha, P.O. Box SS5382, #21 Montaque Heights, Nassau, Bahamas Liquidator

THE TRIBUNE

Tuesday, November 14, 2017, PAGE 3

Accountants urged to ‘stay on cutting edge’ By NATARIO MCKENZIE Tribune Business Reporter nmckenzie@tribunemedia.net THE Bahamas Institute of Chartered Accountants (BICA) president yesterday urged the profession to stay on the “cutting edge”, adding: “We have to make sure we are who we champion ourselves to be”.

Gowon Bowe, addressing the opening of BICA’s Accountants Week conference, said: “We have to stay on the cutting edge. Each and everyone of us is responsible for ensuring that we maintain our professional development. “The concept of saying that I have passed through school, finished my exams - been there,

done that - is not the mantra that should be supported. “When we look at what our continued professional development has evolved into, and the development of continued education partnerships with the American Institute of Chartered Accountants, it shows that we are very serious about our continued education.

Said Mr Bowe: “Not all that we have to say will be good or welcome news. “But as long as we are objective and criticising with the view to being partners and collaborators in the solutions, I think it will be accepted. “We have to make sure that we are who we champion ourselves to be,” he continued.

“If we serve our role we will be highly influential in demonstrating to the world not only the strength of the Bahamas but its financial performance on an annual basis.” Mr Bowe said that next year the Bahamas will play host to the Institute of Chartered Accountants of the Caribbean (ICAC) conference.

Gov’t ‘increasing risk’ via $800m borrowing FROM PAGE 1 bank liquidity, representing assets available for lending, increased by $260.3 million for the nine months to end-September 2017, and the former finance minister suggested the Government look here first. “At this point in time I’d try to mop up as much of the excess liquidity as you can,” Mr Smith told Tribune Business. “The surplus funds have grown very high. It would be good to mop up some of that.” With commercial banks risk averse, and unable to find qualified new borrowers, excess liquidity grew from $1.432 billion to $1.707 billion during the 12 months to end-September 2017. With banks increasingly reluctant to accept new deposits (liabilities), Mr Smith said savers were effectively being penalised by the near-zero interest rates on offer - something a local government capital raising might help alleviate. “It would provide additional revenue for the banks, and they might be able to push up deposit rates,” he told Tribune Business. “At the moment we’re punishing savers, and we want to do just the opposite. “One way to do that is absorb some of the liquidity that can’t be lent out because of risk aversion, due to banks’ problems with non-performing loans. From my point of view, it would be worthwhile to examine how much of the new money we’re going out for is available locally, as it will pick up deposit rates for savers, and we want to encourage saving in any economy. “It would also relieve pressure on the banks, helping to normalise the sector and getting them back to what they ought to be doing, which is lending money for mortgages and small and medium-sized enterprises.” Mr Smith also suggested that the low returns on bank deposits could drive pension funds, insurance companies and other institutions seeking long-term assets to seek out riskier investment vehicles to meet their targets. Had the Government come to the local capital markets, he argued that it could have assisted pension funds and others to match their long-term liabilities to bonds of varying maturities. “I guess they have their reasons, but from my vantage point if we have excess liquidity in the system the idea would be to absorb that,” Mr Smith reiterated. “I caution my remarks, as they may have very good reasons for doing it, but looking at it from the outside I think some effort should have been made to mop up excess liquidity first.” Tribune Business exclusively revealed on Monday how K P Turnquest, deputy prime minister, and Marlon Johnson, the Ministry of Finance’s financial secretary, are both on a week-long trip through the world’s financial capitals to raise investor support for the proposed $800 million borrowing. This newspaper reported that only $550 million of the proposed $800 million bond facility is likely to be ‘new money’. The balance is likely to be used to repay the $250 million short-term loan that Deutsche Bank gave the Government on September 14, 2017.

Explaining the rationale for raising debt financing outside the Bahamas, several sources said that given the size of the 2016-2017 fiscal deficit left by the Christie administration and the borrowing needs for 2017-2018, the Government felt it would have to seek at least $500 million on the international markets. With total borrowing needs estimated at $722 million for the combined two fiscal years in the May Budget, the belief was that the Bahamian capital markets may only be able to provide a limited amount especially since the likes of banks and insurance companies have restrictions on how much government debt they hold, and some may be reaching that limit. The Government’s borrowing requirement, though, may have increased considerably as a result of the 2016-2017 fiscal deficit increasing from the initially projected $500 million to almost $695 million - a rise of almost $200 million. Mr Smith yesterday said a key question was how much of the $800 million facility will be used to repay existing foreign currency debt, as opposed to adding to the $7.2 billion-plus national debt. He argued against foreign currency borrowing simply for the sake of boosting the Bahamas’ external reserves, which stood at $1.064 billion at end-September 2017. “It might have been a mistake in the previous administration when it went out for foreign currency borrowing,” Mr Smith told Tribune Business. “If it’s not for a specific project, it becomes Balance of Payments support.

“You have to pay it back in US dollars, and you might be crowding out imports needed to run the economy. “We’re not seeing any major injection of foreign capital from tourist expenditure and foreign direct investment. By piling on more and more foreign debt you’re increasing your risk.” Central Bank data for end-June 2017, the latest available, revealed that the Government’s total foreign currency liabilities were then equivalent to 26.8 per cent of the direct charge on government, standing at $2.641 billion. The national debt stood at $7.263 billion at end-June 2017, and this financing will likely push it close to the $8 billion mark. Capital markets sources estimated that the new borrowing would take the Bahamas beyond the 30 per cent threshold, while the Democratic National Alliance (DNA) provided a less conservative estimate of almost 40 per cent of the Government’s direct debt. Arinthia Komolafe, the DNA’s deputy leader, raised the same questions as Mr Smith, challenging the Government’s decision to “choose international borrowing over domestic borrowing amidst elevated liquidity”. She also asked whether the Government has established an “upper limit” for foreign currency debt as a percentage of the total, and what the likely cost (interest rate) attached to the $800 million facility will be given the Bahamas’ current ‘junk’ credit rating with Standard & Poor’s (S&P) and recent avoidance of the same with Moody’s.

NOTICE OF ANNUAL GENERAL MEETING TO:

All Members of Bahamas Agri-Business Co-operative Society Limited

Notice is hereby given that the Annual General Meeting of Bahamas Agri-Business Co-operative Society Limited will be held at IICA Bahamas, located #5 Village Road, Nassau, Bahamas, on Friday November 24, 2017 commencing at 6:30pm for the following purposes: To receive the following Reports: Chairman Minutes of the Third Annual General Meeting Audited Financial Statements Supervisory • To elect members of the Board of Directors • To take actions on such matters as may come before the meeting Secretary

Account/Office Manager Accounts management-payables/receivables Proficient in Quick Books Pro Proficient in Microsoft Suite/ Excel and Word Electronic payroll/NIB contributions/VAT Bank Reconciliation Prepare reports for Director Day to day running of office-banking, etc. Inventory control Prepare orders from USA and China Customer service - retail and service clients Excellent communication, interpersonal, oral and written skills House of operation: 730am to 4pm Submit all applications to: jobapplicant242@gmail.com

“Has a thorough impact analysis on external reserves, inclusive of meeting import demands and sustaining parity with the $US in the medium to long-term, been conducted considering reduced FDI and vulnerabilities within key sectors of our economy?” Mrs Komolafe asked. “After six months in office, and during execution of austerity measures which include lay-offs in the public sector and a 10 per cent cut across the board in government spending, the current FNM administration is yet to produce for the Bahamian people a comprehensive strategy to

grow the economy. “This administration seems to be on the same ‘Tax, Spend and Borrow’ trajectory as its predecessors. It is common knowledge that austerity measures alone will not improve the economic state of our nation, nor will it pay for the additional $800 million that this administration is seeking to place on the backs of the Bahamian people, effectively mortgaging our children’s future.” Mrs Komolafe also warned that the Government’s new borrowings would further add to debt servicing costs that are already the biggest line item in its Budget at $292.485

million, potentially sucking money away from services such as health, education, social services, the police and national security. Mr Smith, meanwhile, added: “Generally, as best you can, you want to keep the foreign component of the national debt as small as you possibly could. “You have more leverage with the Bahamian dollar component because that is held by institutions like NIB and the banking system, and in the event you run into a rough period it’s easier to reschedule given that it’s your own currency within your own borders.”

PAGE 4, Tuesday, November 14, 2017

THE TRIBUNE

Investors ‘amazed’ over BOB’s first profit in 5 years FROM PAGE 1 year had been a profitable one. Treating it as a modest bit of good news, they expressed hope this signalled the start of a long road to recovery and consistent net income performances. “That’s incredible if you say it is,” Mike Lightbourn, Coldwell Banker Lightbourn Realty’s president, replied when informed of the first quarter profit. “I’m amazed and I’m delighted. They’re getting rid of the bad loans.” Mr Lightbourn, who had written-off his BOB investment in common with many of the other 3,000 minority shareholders, said investors are now watching to see whether the first quarter performance can be sustained. “We have to wait and see, but they’re trying to run the bank like it should be run,” he told Tribune Business. “I’m hoping it’s headed in the right direction. We’re

in a tough economy, but getting all the commercial loans off their books will help enormously.” Mr Lightbourn, though, conceded that minority shareholders will have to be in it for the long haul if their investments are to regain previous value. “It’s possible down the road,” he said, “but I don’t know what will happen in the meantime. “It’s a disgrace, and I’m very disappointed, that nobody has been held accountable for what has happened to Bank of the Bahamas. That’s a polite way of putting it.” Another BOB shareholder, speaking on condition of anonymity, said the BISX-listed institution’s return to profitability suggested that the new Board, headed by former PricewaterhouseCoopers (PwC) accountant and partner, Wayne Aranha, was already having an impact. “I think they are obviously on the right track and have a good set of directors

NOTICE INTERNATIONAL BUSINESS COMPANIES ACT 2000 (No. 46 of 2000)

there right now,” the shareholder said. “Wayne Aranha is a very smart guy, and he’s going to take whatever steps are needed to turn the bank around. “All the shareholders, especially those that turned up for the annual general meeting (AGM), have faith in his approach. He’s a very no-nonsense and methodical guy, and we have confidence he’s going to do everything in his power to turn the bank around. “Once people see things are beginning to turn around, confidence will increase, depositors will start going there, and allaround faith in the bank will improve.” BOB’s end-September 2017 balance sheet shows the summer bail-out’s full impact, with some $113 million written back in as ‘special retained earnings’ as a result of the toxic asset transfer to Bahamas Resolve. That sum represents the difference between the $162 million gross value assigned to the transferred loans, and their much smaller ‘net book value’ of $49 million.

The ‘write back’s’ end result was that BOB’s ‘special retained earnings’ jumped from $54.623 million to $167.26 million, the former figure representing what was ‘gained’ from the first Bahamas Resolve bail-out in October 2014. The ‘special retained earnings’ now exceed BOB’s $139.841 million in accumulated losses at endSeptember 2017, and were almost entirely responsible for the bank’s net equity increasing from $63.908 million to $177.384 million within three months. The Bahamas Resolve transaction also brought BOB’s regulatory capital ratios immediately into line with the Central Bank’s requirements, with some now triple the latter’s minimum stipulations. The balance sheet, though, also reminds how BOB would be insolvent without the $211.825 million in government bonds that were injected to fill its financial holes. Stripping this out would leave BOB with assets of $641 million compared to total liabilities of $674.71 million.

(the Company)

FROM PAGE 1

Pursuant to the provisions of Section 138 (8) of the International Business Companies Act, No. 45 of 2000, the Dissolution of PIPER INTERNATIONAL HOLDINGS INC., has been completed. The Company was struck off the Register and a Certificate of Dissolution has been issued by the Registrar General on the 6th day of October, 2017.

Kofi Bain Liquidator

we’re not using the mail as it’s not good.” Apart from the private sector, Mr Myers said the Post Office’s problems were also impacting households and individual Bahamians. “It’s also hurting a lot of people with regard to Bahamas Power & Light (BPL) and having their power disconnected because they don’t see their bills,” he added. “Most of us register online, but it’s the same tune with real property tax bills, Cable Bahamas and all utility services. We have

to go to an electronic world, but it’s definitely a problem for some accounts.” Many Bahamians have been receiving bank, utility and other bills up to threefour months past their due date, as reduced hours due to poor working conditions have impacted the Post Office’s ability to deliver efficient, timely service. The former Christie administration entered into a Public-Private Partnership (PPP) to construct a new Post Office at the Independence Drive Shopping Centre opposite the Town Centre Mall, but that

MARKET REPORT MONDAY, 13 NOVEMBER 2017

t. 242.323.2330 | f. 242.323.2320 | www.bisxbahamas.com

BISX ALL SHARE INDEX: CLOSE 2,067.19 | CHG 0.05 | %CHG 0.00 | YTD 128.98 | YTD% 6.69 BISX LISTED & TRADED SECURITIES 52WK LOW 4.06 17.43 8.19 3.50 1.22 0.12 3.50 8.40 5.83 3.15 9.00 2.18 1.40 5.81 8.78 5.75 3.35 6.61 12.01 10.00

1000.00 1000.00 1000.00 1000.00

PREFERENCE SHARES

1.00 105.00 100.00 106.00 105.00 103.00 100.00 10.00 1.01

1.00 100.00 100.00 100.00 105.00 100.00 100.00 10.00 1.00

SECURITY AML Foods Limited APD Limited Bahamas Property Fund Bahamas Waste Bank of Bahamas Benchmark Cable Bahamas CIBC FirstCaribbean Bank Colina Holdings Commonwealth Bank Commonwealth Brewery Consolidated Water BDRs Doctor's Hospital Famguard Fidelity Bank Finco Focol ICD Utilities J. S. Johnson Premier Real Estate Cable Bahamas Series 6 Cable Bahamas Series 8 Cable Bahamas Series 9 Cable Bahamas Series 10 Colina Holdings Class A Commonwealth Bank Class E Commonwealth Bank Class J Commonwealth Bank Class K Commonwealth Bank Class L Commonwealth Bank Class M Commonwealth Bank Class N Fidelity Bank Class A Focol Class B

CORPORATE DEBT - (percentage pricing) 52WK HI 100.00 100.00 100.00

52WK LOW 100.00 100.00 100.00

SYMBOL AML APD BPF BWL BOB BBL CAB CIB CHL CBL CBB CWCB DHS FAM FBB FIN FCL ICD JSJ PRE CAB6 CAB8 CAB9 CAB10 CHLA CBLE CBLJ CBLK CBLL CBLM CBLN FBBA FCLB

SECURITY Fidelity Bank Note 17 (Series A) + Fidelity Bank Note 18 (Series E) + Fidelity Bank Note 22 (Series B) +

SYMBOL FBB17 FBB18 FBB22

Bahamas Note 6.95 (2029) BGS: 2014-12-3Y BGS: 2015-1-3Y BGS: 2014-12-5Y BGS: 2015-1-5Y BGS: 2014-12-7Y BGS: 2015-1-7Y BGS: 2014-12-30Y BGS: 2015-1-30Y BGS: 2015-6-3Y BGS: 2015-6-5Y BGS: 2015-6-7Y BGS: 2015-6-30Y BGS: 2015-10-3Y BGS: 2015-10-5Y BGS: 2015-10-7Y

BAH29 BG0103 BG0203 BG0105 BG0205 BG0107 BG0207 BG0130 BG0230 BG0303 BG0305 BG0307 BG0330 BG0403 BG0405 BG0407

BAHAMAS GOVERNMENT STOCK - (percentage pricing) 115.92 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

104.79 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

MUTUAL FUNDS 52WK HI 2.10 3.98 1.97 176.30 149.66 1.50 1.67 1.58 1.10 6.99 8.54 6.15 10.52 11.46 10.46

52WK LOW 1.67 3.04 1.68 164.74 116.70 1.44 1.63 1.55 1.04 6.41 7.62 5.66 8.65 10.54 9.57

LAST CLOSE 4.31 17.43 9.09 3.70 1.25 0.15 3.70 8.60 6.10 4.94 9.02 2.29 1.51 6.00 10.06 6.30 4.50 7.01 12.50 10.00 1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00 LAST SALE 100.00 100.00 100.00 108.73 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

CLOSE 4.31 17.43 9.09 3.70 1.25 0.15 3.70 8.60 6.10 4.94 9.02 2.35 1.51 6.00 10.06 6.30 4.50 7.01 12.50 10.00

CHANGE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.06 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

1000.00 1000.00 1000.00 1000.00 1.00 100.00 100.00 100.40 100.00 100.00 100.00 10.00 1.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

CLOSE 100.00 100.00 100.00

CHANGE 0.00 0.00 0.00

108.61 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00

-0.12 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

FUND CFAL Bond Fund CFAL Balanced Fund CFAL Money Market Fund CFAL Global Bond Fund CFAL Global Equity Fund FG Financial Preferred Income Fund FG Financial Growth Fund FG Financial Diversified Fund FG Financial Global USD Bond Fund Royal Fidelity Bahamas Opportunities Fund - Secured Balanced Fund Royal Fidelity Bahamas Opportunities Fund - Targeted Equity Fund Royal Fidelity Bahamas Opportunities Fund - Prime Income Fund Royal Fidelity Int'l Fund - Equities Sub Fund Royal Fidelity Int'l Fund - High Yield Fund Royal Fidelity Int'l Fund - Alternative Strategies Fund

VOLUME

NAV 2.10 3.98 1.97 176.30 149.66 1.51 1.64 1.59 1.09 6.97 8.00 6.25 10.96 11.60 10.08

EPS$ 0.444 0.932 -0.223 0.540 -1.373 0.000 -0.857 0.611 0.574 0.196 0.582 0.102 0.392 1.217 0.743 0.575 0.310 -0.668 0.543 0.000

DIV$ 0.080 1.000 0.000 0.210 0.000 0.000 0.000 0.300 0.220 0.120 0.570 0.060 0.050 0.290 0.450 0.000 0.120 0.140 0.600 0.000

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

P/E 9.7 18.7 N/M 6.9 N/M N/M -4.3 14.1 10.6 25.2 15.5 23.0 3.9 4.9 13.5 11.0 14.5 -10.5 23.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

YIELD 1.86% 5.74% 0.00% 5.68% 0.00% 0.00% 0.00% 3.49% 3.61% 2.43% 6.32% 2.55% 3.31% 4.83% 4.47% 0.00% 2.67% 2.00% 4.80% 0.00% 0.00% 0.00% 0.00% 0.00% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 6.25% 7.00% 6.50%

INTEREST 7.00% 6.00% Prime + 1.75%

MATURITY 19-Oct-2017 31-May-2018 19-Oct-2022

6.95% 4.00% 4.00% 4.25% 4.25% 4.50% 4.50% 6.25% 6.25% 4.00% 4.25% 4.50% 6.25% 3.50% 3.88% 4.25%

20-Nov-2029 15-Dec-2017 30-Jul-2018 16-Dec-2019 30-Jul-2020 15-Dec-2021 30-Jul-2022 15-Dec-2044 30-Jul-2045 26-Jun-2018 26-Jun-2020 26-Jun-2022 26-Jun-2045 15-Oct-2018 15-Oct-2020 15-Oct-2022

YTD% 12 MTH% 3.29% 4.48% 1.69% 2.22% 1.77% 2.42% 4.66% 3.89% 5.58% 6.65% 2.15% 4.22% -1.93% -1.89% 0.81% 2.21% 2.28% 1.30% -1.08% 1.77% -5.96% -3.05% 1.90% 4.59% 7.24% 11.96% 2.77% 3.88% 3.94% 4.69%

NAV Date 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017 30-Sep-2017

MARKET TERMS BISX ALL SHARE INDEX - 19 Dec 02 = 1,000.00 52wk-Hi - Highest closing price in last 52 weeks 52wk-Low - Lowest closing price in last 52 weeks Previous Close - Previous day's weighted price for daily volume Today's Close - Current day's weighted price for daily volume Change - Change in closing price from day to day Daily Vol. - Number of total shares traded today DIV $ - Dividends per share paid in the last 12 months P/E - Closing price divided by the last 12 month earnings

Bahamas Resolve during its term in office. BOB’s push into consumer lending, following the likes of Commonwealth Bank and Fidelity Bank (Bahamas), is also evident from the portfolio’s 16.9 per cent year-over-year growth - from $53.673 million to $62.745 million. The bank’s gross interest income for the first quarter was essentially flat yearover-year at $9.105 million, but margins and net interest income jumped 7.5 per cent to $6.686 million due to lower deposit rates. Higher net fee and commission income, which rose 19.9 per cent to $1.847 million, and growth in other income saw operating rise by just over $1 million to $9.439 million. The decline in loan loss provisions resulted in net operating income growing by 96 per cent - from $3.998 million to $7.849 million. The near-doubling in operating income ensured BOB was able to more than cover its expenses, which dropped by 4.3 per cent, for the first time in almost five years.

Businesses hit by Post Office ‘disaster’

PIPER INTERNATIONAL HOLDINGS INC.

52WK HI 4.38 19.17 9.09 3.70 1.96 0.16 5.60 8.60 6.30 5.30 14.49 2.59 1.60 6.00 10.06 11.00 4.50 7.25 12.51 11.00

Some $50 million of the total $261.825 million in bonds injected to BOB have already been redeemed, a move likely responsible for the bank’s cash balances growing from $97.97 million to $148.337 million quarterover-quarter. BOB’s unaudited financial statements for the quarter to end-September 2017 also disclose how its total commercial loan book has decreased by 54 per cent year-over-year as a result of the Bahamas Resolve transfer. Outstanding commercial mortgage credit fell by 75.8 per cent, or more than three-quarters, from $64.791 million to $15.667 million, while other commercial loans dropped from $178.237 million to $96.316 million - a fall of 46 per cent. The figures show how BOB’s consistently heavily losses since 2014 have stemmed largely from ‘toxic’ commercial loans, and raise fresh questions as to why the Christie administration did not shift more non-performing credit to

YIELD - last 12 month dividends divided by closing price Bid $ - Buying price of Colina and Fidelity Ask $ - Selling price of Colina and fidelity Last Price - Last traded over-the-counter price Weekly Vol. - Trading volume of the prior week EPS $ - A company's reported earnings per share for the last 12 mths NAV - Net Asset Value N/M - Not Meaningful

TO TRADE CALL: CFAL 242-502-7010 | ROYALFIDELITY 242-356-7764 | FG CAPITAL MARKETS 242-396-4000 | COLONIAL 242-502-7525 | LENO 242-396-3225

project was placed on hold following complaints from local residents and concerns over whether proper due diligence had been conducted. Since the Minnis administration took office there has been talk of moving the Post Office to the Town Centre Mall, or the former Phil’s Food Services building on Gladstone Road, but no tangible actions have yet been taken. Mr Myers yesterday called for the Post Office to be privatised, downsized or even shut down if it failed to perform an efficient service and continues to cost taxpayers money. “I don’t know what it’s costing the Government

and citizens to run the Post Office,” he told Tribune Business, “but if it’s a lot of money maybe we should consider doing away with it or shutting it, downsizing it considerably. “Maybe it’s time to look at privatisation and outsourcing all over again. It’s a dying industry with DHL and FedEx, but I imagine in some cases it’s necessary as people don’t have an Internet connection or ability to log-on to a website. “But does it need to be the same size it was in the 1970s and 1980s? Maybe it could be shrunk, outsourced if it’s taking a considerable amount of expenditure from the annual Budget.”

TO ADVERTISE TODAY IN THE TRIBUNE CALL @ 502-2394 LIQUIDATOR’S NOTICE PURSUANT TO SECTION 138 (6) OF THE INTERNATIONAL BUSINESS COMPANIES ACT We, Sterling (Bahamas) Limited, Liquidator of ALPHA CENTAURI QUANTUM FUND LTD., hereby certify that the winding up and dissolution of ALPHA CENTAURI QUANTUM FUND LTD., has been completed in accordance with the Articles of Dissolution. Dated the 18th day of October 2017 Sterling (Bahamas) Limited Liquidator LIQUIDATOR’S NOTICE PURSUANT TO SECTION 138 (6) OF THE INTERNATIONAL BUSINESS COMPANIES ACT We, Sterling (Bahamas) Limited, Liquidator of ANTAR ALGORITHM TECHNOLOGIES FUND LTD., hereby certify that the winding up and dissolution of ANTAR ALGORITHM TECHNOLOGIES FUND LTD.., has been completed in accordance with the Articles of Dissolution. Dated the 18th day of October 2017 Sterling (Bahamas) Limited Liquidator