‘NCB NOT FOR SALE!’

Jamaica-born, Canadian billionaire businessman Michael Lee-Chin has dismissed in the strongest terms any suggestion that he is beginning a slow off-loading process of his majority share ownership in the National Commercial Bank (NCB) with a view to selling the bank in the near future.

Lee-Chin, in an interview with The Gleaner yesterday, said the bank remains a patriotic investment for him, a successful business and a reminder to everyone born in poverty like he was, that they can aspire to greatness. He also used the opportunity to reassure shareholders who have not received a dividend on their shares since the pandemic that they will be paid in the very near future.

“I have always lived my life in a very transparent way, and I am not about to stop now,” he said.

“So let me answer your question in the same transparent way. NCB is not for sale, period. I am not selling NCB. I will remain the controlling shareholder of NCB Financial Group. That is what I am telling you.”

Lee-Chin said he owns about 1.5 billion shares in the entity and he sold just over one per cent, which was no different from someone having $100 and using $1 for something.

According to him, it was not the first time that he has sold shares as he has been buying and selling shares over several years. In 2002, Lee-Chin purchased 76 per cent of NCB shares with a downpayment of US$56 million. The cost of a share at the time was J$4. The full purchase price was US$127 million, equivalent at the time of $6.03 billion. The balance was paid over nine years.

Proud of NCB success

He said that after 21 years, selling the shares at $68 per share was not bad business and disposing of such small numbers has nothing to do with his attitude and love for his ownership of NCB.

“First and foremost, I am a Jamaican and I am proud of the success I have had in my life. And one of the most successful ventures I have had was to buy NCB in 2002 and turn it around to become the most profitable and largest financial institution in Jamaica, and secondly, one of the largest in the Caribbean. It is part of my legacy, and I am not going to give that up, period,” he restated.

NCB Jamaica led the purchase of Guardian Holdings, which gave the group a footprint in 22 countries. Jamaica today represents 50 per cent of NCB’s earnings, with the rest from the Caribbean. Through Guardian Holdings, they have been given a foothold in Holland.

But the businessman has been off-loading high-priced assets, which has fuelled the speculation that he is off-loading assets in anticipation of a global economic downturn with higher interest rates on the horizon. The World Bank said global growth is projected to slow significantly amid high inflation, tight monetary policies, and restrictive credit conditions.

He told The Gleaner that he has significant real estate in the Dominican Republic but that he and that country’s government are involved in litigation. He alleged that the Dom Rep government expropriated his shares in a landfill, which is the fifth largest in the world and for which he has sued. An arbitrator’s ruling is expected in the next month for his claim of US$750 million. As a result, he said he does not feel comfortable there, last visiting in 2017, and is disposing of his assets there.

“I have a house in Cayman Islands, which we bought about eight years ago, and I have never slept in the house. It was bought on the assumption that we would live there, but I have never slept in the house. So if you don’t spend a night in the house that you bought, sell it,” he argued.

The asking price for the house, which he acquired five years ago, is US$35 million. It was purchased for US$12.5 million.

His mega yacht, which was recently sold, went for US$362 million and the businessman said it was the third one he was selling.

An engineer, Lee-Chin said it was nothing more than business.

Lee-Chin also addressed the vexed question of the non-payment of dividends, such as were paid to shareholders until the COVID-19 pandemic struck in 2020 and the Bank of Jamaica (BOJ) said no financial institution should pay dividends. Since the easing of the impact of the pandemic, the BOJ has released institutions to pay dividends to their shareholders.

NCB, however, has only paid dividends once since then. Shareholders are not pleased.

“Financial institutions can pay dividends. But we now have to look at our own financial situation, look at the world and ask where is the business going and what capital will it need. We have a growing business that will need more capital to become digital; where the accounting standards are changing; that is going into a period of higher interest rates in both Jamaica and the USA, which means that the economy is going to slow down,” he explained.

“For all those reasons, we have to make sure that the institution is strong, which it is, and not paying dividends, the capital is kept in the company for eventualities that could happen. So we just have to make sure that the bank remains strong. You have to understand also that when dividends are not paid, the person who suffers the most is the person with the most shares, in terms of the dollar amount. But everyone suffers,” he stated.

Telling The Gleaner that he understands the pain of the pensioner, and every investor, he said his responsibility as chairman of the bank and majority shareholder, he had to make sure the bank remains strong and will outlast him and continue to grow.

“Now, on a go-forward basis, we are very conscious that everyone needs to be paid, especially those whose shares represent their pensionable investment. So we will, and are doing everything right now for them to be paid, and they will be paid,” he said, though without giving a clear timeline.

When pressed, he said: “I can’t tell you when, but it will be in the very soon future. Trust me on that.”

In 2021, the NCB board of directors declared an interim dividend of J$0.50 per ordinary stock shares payable on May 31, 2021. Shereholders have expressed anger at the bank for the non-payment.

“I give my word on that,” he said.

erica.virtue@gleanerjm.com