Barbados selling CLICO holdings

PM David Thompson - file photo

Barbadian Prime Minister David Thompson says the life insurance arm of CLICO Holdings (Barbados) Limited (CBH) could be sold in a "radical" move to protect the interests of policyholders. CBH is a wholly owned subsidiary of CL Financial. It has assets totalling over US$500 million.

In a television question and answer show Sunday night Thompson said the government has decided on a more radical route and has "received confirmation from CLICO Life that it will work with a reputable Barbadian entity to possibly enter into a memorandum of understanding for the purchase of CLICO Life."

He said the parties are working on a Memorandum of Understanding (MOU) for the sale of CLICO Life.

CLICO's other companies in the island that deal with general insurance, mortgage and finance, balanced fund and property development won't be affected by the same, he said.

Thompson defended his government against charges leveled by opposition Mia Mottley, who last Friday filed a no-confidence motion against him over his handling of the CLICO matter.

Mottley claimed that Thompson misled more than 38,000 policyholders when he said that CLICO Barbados was sound, prudently managed and well regulated, and that Barbadian depositors, investors and holders of insurance policies could be considered safe.

She charged that Thompson knew or ought to have known that the Statutory Fund deficit of the company was US$46.5 million at the end of 2007, noting that the fund should contain enough assets to match liabilities in order to protect policy holders.

But the Barbados leader threw the blame on the previous Labour Party government, saying it's own negligence helped create the problem.

"From 2004 to 2007 nothing has been done and yet all of a sudden we are being told that I am the one who is responsible for the deficit." He said CLICO fell short of its Statutory Fund obligations from 2005 onwards.