Barita issues addendum to APO prospectus

Barita Investments has issued an addendum to its prospectus in relation to its additional public offering (APO) which opened on September 6.

The addendum was a requirement of the Financial Services Commission (FSC) to ensure an orderly disclosure of material information relevant to the public offer.

It also comes on the heels of questions raised by the Trinidad Express referencing Bartia and its parent company, Cornerstone Financial Holdings.

The addendum provides commentary and analysis in relation to the financial statements, key business drivers and outcomes for the company’s third quarter covering the nine months ending June 2021. The FSC says the disclosures have been reviewed in line with their requirements for disclosures in Management Discussion and Analysis.

For the nine-month period, Barita recorded an 83 per cent jump in net profits to $3.7 billion and a 77 per cent rise in net operating revenues to $6.7 billion.

The document explained that the expanded focus in the group’s credit and fixed income portfolios, a 50 per cent year on year rise in repo liabilities, as well as improvements in fees and commission income, and foreign exchange trading and translation gains were the main contributors to the rise in revenue.

Mention was also made of the special holdings company, Barita Finance Limited (BFL), which the company said was responsible for increased activity in its structured finance division, leading to growth in its asset management business.

According to the addendum, Barita Finance offers customised investment solutions including notes/bonds to investors.

It said the solutions are typically supported by assets in an underlying portfolio managed by Barita Investments. For that service, Barita Investments receives compensation from Barita Finance in the form of a management fee.

Barita noted that the investment management arrangement has a fixed/performance-linked fee structure, which has allowed the company to participate in returns generated by the portfolio. For the period under review, Barita Investments generated $696 million in direct fees from the structured finance division.

Barita’s total assets stood at $84.2 billion as at June 2021, a 62 per cent increase over the previous year.

Bank of Jamaica responds to CBDC concerns

The Bank of Jamaica (BOJ) says it has no issue with blockchain technology, despite not choosing a blockchain solution to run Jamaica’s digital currency.

The response follows concerns raised by the Caribbean Blockchain Alliance, following an exclusive interview on Taking Stock with the CEO of eCurrency. eCurrency is the company that won the bid to develop Jamaica’s digital currency.

There’s now a debate over the technology being used by eCurrency versus the blockchain solution.

The BOJ said not using blockchain at the source to mint, issue and redeem Jamaica’s Central Bank Digital Currency does not prevent wallet providers from incorporating blockchain in their network to deliver the digital currency to their customers.

The BOJ also said the possibility exists that the central bank might use blockchain technology in other ways in the future.

BOJ says eCurrency’s solution met all the requirements of the bank as it provides the ability for BOJ to conduct all the currency management processes of a central bank.

It said the solution provides seamless integration with the existing financial market infrastructure in Jamaica, in particular the JamClear® Real Time Gross Settlement System (RTGS), at the earliest possible timeline and allows for quick scalability.

US President gives vaccine mandate, PM Holness sees justification

United States President Joe Biden has announced that federal government employees and contractors will now be required to be fully vaccinated against COVID-19.

He also mandated the Occupational Safety and Health Administration to create a rule for private businesses with 100 or more employees to require their employees to be vaccinated or get tested weekly.

The requirements are part of the president’s new six-part strategy to combat the Delta variant. It follows the call in July for federal workers to attest to their vaccination status and submit to mitigation efforts if they are not vaccinated, such as mask usage and regular testing.

Meanwhile, in Jamaica, Prime Minister Andrew Holness has said the current health situation gives strong justification for a vaccine mandate here.

However, he said there would have to be extensive public education and consultation before such a decision is made.

He said the Government would have to demonstrate that all options have been exhausted and that citizens have been engaged on the plans to ensure their rights are protected.

Pulse secures $1.1-billion bond

Pulse Investments has secured a $1.1-billion, seven-year bond, which it said will be used to complete its transformation to a real estate company.

This follows the capital raise of $1.21 billion earlier this year, which comprised a $440-million short-term loan and a $770-million note extended by a related party. The funds were used to acquire the Villa Ronai property and retire debt.

Pulse said the new bond will be used to repay the short-term loan and finance the first phase of the 30-unit Pulse Homes development at Villa Ronai. Construction is planned to start later this year.

The bond, being arranged and underwritten by Barita Investments, is to be listed on the Jamaica Stock Exchange’s private bond market.

Pulse is scheduled to file its audited financial statements with the JSE within the next few days.

Proven says Dream Weekend backlash didn’t influence

President and CEO of Proven Management, Christopher Williams has said the company’s decision to sell its 20 per cent stake in Dream Entertainment was not influenced…by the controversy over this year’s staging of Dream Weekend.

There have been criticisms that the five-day party series, held in Negril August 5-9, has contributed to Jamaica’s third wave of COVID-19.

However, in a response to the Jamaica Observer, Williams said Proven had accepted an offer from June, before any discussion started about the reopening of the entertainment sector.

The announcement of the completion of the transaction was made last week in a release on the Jamaica Stock Exchange (JSE).

The shares have been sold to Jamaican company, Yes Iyah Limited, whose directors and principals are Ryan Reid, Michael Banbury and Sean Shelton.

Reid and Banbury are also co-founders of real estate and private equity company, First Rock Capital Holdings.

Proven had acquired the 20 per cent shares in Dream in 2019 for US$570,000 or J$75.28 million. Williams told the Observer that they broke even on the sale.

Rocky start to El Salvador’s Bitcoin adoption

El Salvador faced challenges while becoming the first country to start using the cryptocurrency as legal tender.

According to the New York Times, the price of Bitcoin had broke $52,000 last Monday with the announcement that El Salvador had bought an initial 200 bitcoins in anticipation of the roll-out.

It quickly fell to around $45,000 on Tuesday as thousands in opposition to the cryptocurrency and judicial changes took to the streets to protest its use. Protesters included judges and magistrates.

To make matters worse, the Government’s digital app, facilitating transactions, also went offline temporarily.

The president said the servers powering the wallet, Chivo, had to be taken offline to add capacity. He said the stakeholders preferred to correct it before reconnecting it.

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