Finance Minister Larry Howai has ordered a full review into the First Citizens Initial Public Offer (IPO) after reports the group’s chief risk officer, Phillip Rahaman, purchased $14 million worth of shares through the special offer of the bank’s shares for employees.
Last year, the Government issued 48.5 million shares (just under 20 per cent of its 100 per cent stake) to be traded on the Trinidad and Tobago Stock Exchange. The group’s 1,664 employees were allotted 15 per cent (7.2 million) of that.
Each staff member had the option of purchasing a guaranteed maximum 5,000 shares at a ten per cent discount, and a guaranteed minimum of 500 shares. Several staff members did not participate, so other employees—including Rahaman— were able to purchase shares in excess of the discounted availability.
The IPO’s share price was $22 per stock unit, or $19.80 discounted ten per cent. Rahaman reportedly purchased $14 million worth of shares, as reported in the company’s annual report for 2013.
“Immediately upon noting the information in the annual report, I requested (my ministry) to undertake enquiries. Meetings were held with representatives of the bank and a detailed audit was requested. This is being done. The ministry has also advised the various regulatory authorities of this development, in accordance with required procedures,” Howai said in a statement yesterday.
He added he “remained satisfied” the ministry has to proceed with honouring its statutory responsibilities in this matter.
This was the furthest he could comment at this stage, he said, but he “stood ready to provide the public of Trinidad and Tobago with pertinent information as soon as same is deemed allowable for disclosure”.
The bank also released its unaudited consolidated financial statements for the first quarter ending December 31, 2013, yesterday. In her report as chair of the State banking group, Nyree Alfonso said the group concluded “another profitable year”.
Profit after tax increased by 3.9 per cent over the same period last year to $174.8 million, the report said.
First Citizens closed trading on the TTSE yesterday at $38.98, gaining four cents. —Carla Bridglal