RATING DRIVERS

Supporting Factors

• Continued stable financial performance
• Healthy capitalization and strong reinsurance programme
• Well diversified investment portfolio with satisfactory asset quality

Constraining Factors

• High reliance on brokers poses a threat to earnings stability
• Prevailing economic conditions constrain profitability and growth

Rating Sensitivity Factors

Factors that could, individually or collectively, lead to an improvement in the ratings and/ or outlook include:

• An improvement in market share of general insurance products in its largest market, T&T to 10% or more
• An improvement in the overall credit profile for Beacon’s fixed income portfolio where more than 60% of the portfolio is rated investment grade on the S&P rating scale
• Enhancement of Beacon’s risk management through the complete rollout of an enterprise risk management system
• Increased profitability leading to an improvement in ROA and ROE to above 2.5% and 10% respectively for 2 consecutive financial periods

Factors that could, individually or collectively, lead to a lowering of the ratings and/ or outlook include:

• A 2-notch deterioration of the credit rating of Beacon’s top reinsurer.
• A deterioration of the company’s capital adequacy ratio to 150% or lower on a sustained basis for at least 6 months under normal conditions

The Beacon Insurance Company Limited (‘Beacon’ or ‘the Company’) was originally established in 1972 as the Caribbean Insurance Company Limited, before being rebranded in 1996. On May 7, 2018, Beacon agreed to the sale of 40% of its shareholding to Colonial Group International Limited (CGI) now known as Coralisle Group Limited, a Bermuda-based insurance company with commercial operations in Bermuda, the Cayman Islands, The Bahamas, the British Virgin Islands, Turks & Caicos Islands and Barbados. The transaction was approved by the Central Bank of Trinidad and Tobago on May 3, 2019 and led to a capital injection from all shareholders totalling TT $26.3 million in July 2019.

Beacon is now owned by CGH Limited (46%), CGI (40%), and an individual shareholder (14%). The Company is domiciled in Trinidad and Tobago (T&T) and has a regional presence through its Barbados, Grenada and Saint Lucia offices, and agency operations located in Dominica, Saint Kitts and Nevis, and Saint Vincent and the Grenadines. The Company specializes in general insurance, underwriting for both individual and institutional clients, and offers a broad product range comprised of Property, Motor, Accident and Casualty, Marine Cargo and Hull, Bonds, and Engineering insurance. The Company also provides Group Health and Group Life insurance targeted to institutional clients. The offering of all these products is made possible by Beacon’s composite insurance license which allows the Company to offer any type of insurance without obtaining additional licenses.

Analytical Contacts:

Nikkel Collymore

Tel: 1-868-627-8879 Ext. 240

E-mail: ncollymore@caricris.com

Keith Hamlet

Tel: 1-868-627-8879 Ext. 229

E-mail: khamlet@caricris.com

Website: www.caricris.com

Email: info@caricris.com

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.

CariCRIS assigns ‘good’ creditworthiness ratings to the proposed bond issue of up to US $285 million of Sage Power Limited

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RATING DRIVERS

Supporting Factors:

• Stable and predictable revenue stream underpinned by long-term contracts with strategically important Jamaican entities
• The underlying asset consists of a modern, efficient electricity and steam generating plant, with good operating efficiency
• Adequate debt servicing capacity based on stable lease revenue
• The transaction structure provides adequate protection to investors

Constraining Factors:

• High leverage of Parent can hamper timeliness of financial support, if needed
• Unproven track record of consistent plant performance

Rating Sensitivity Factors

Factors that could, individually or collectively lead to an improvement in the ratings and/ or outlook include:

• Successful operations of the plant over the next two to three years, in accordance with design specifications and on time compliance with the PPA and SSA deliverables over the period

Factors that could, individually or collectively lead to a lowering of the ratings and/or outlook include:

• Deterioration in the financial performance of NFE SPH which could possibly hamper lease payments.
• Deterioration in the credit worthiness of the guarantor (NFE), impacting its ability to deliver in a timely manner any shortfall in lease payments if so required
• Breach in contract from the O&M counterparty, Caribbean Blue Skies Energy, that may affect operations.
• Any material litigation which may affect NFE SPH or NFE Inc
• Breach of any of the bond covenants
• A material reduction in the CHP plant’s availability which would impair its ability to deliver output stipulated in the PPA and SSA

COMPANY BACKGROUND

New Fortress Energy Incorporated (NFE or the Parent)^[1], founded in 2014 in Delaware, USA, is a gas-to-power infrastructure business which focuses on converting existing power generation to run on natural gas, building new gas-fired power generation plants, operating downstream gas-to-power assets, and supplying such assets with natural gas. NFE is a publicly traded company on the NASDAQ exchange with a market capitalization of approximately US $8.6 billion^[2]. NFE has been operating in the region since 2016, having established an onshore storage and regasification facility in Montego Bay, Jamaica in 2016, an offshore floating storage and regasification facility in Old Harbour, Jamaica in 2019 and an onshore facility in San Juan, Puerto Rico in 2020 to supply on-island industrial, commercial and transportation customers with liquefied natural gas (LNG). Furthermore, NFE completed the acquisitions of Hygo Energy Transition and Golar MLP, totaling US $5 billion, significantly increasing NFE’s global portfolio of critical infrastructure assets. Currently, NFE has ten facilities operational or under active development. This global portfolio of assets positions NFE to acquire and supply LNG to customers in a number of attractive markets around the world. In 2016, NFE incorporated a subsidiary NFE South Power Holdings Limited (NFE SPH) in Jamaica to own a combined heat and power plant (CHP Plant) and associated permits, entitlements, operational agreements and commercial agreements.

Analytical Contacts:

Nikkel Collymore

Tel: 1-868-627-8879 Ext. 240

E-mail: ncollymore@caricris.com

Keith Hamlet

Tel: 1-868-627-8879 Ext. 244

Mobile: 1-868-487-8356

E-mail: khamlet@caricris.com

Website: www.caricris.com

Email: info@caricris.com

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable.  However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.  No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval.  CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product

CariCRIS reaffirms ‘good creditworthiness’ ratings to the US $120 million bond issue of JMMB International Limited

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CariCRIS reaffirms ‘good creditworthiness’ ratings for Bourse Securities Limited

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RATING DRIVERS

Supporting Factors

• Good financial performance underpinned by good income diversity and efficiency levels, notwithstanding some deterioration in 2020
• Comfortable risk-adjusted capitalization level reflected in strong capital adequacy ratios and good coverage of total assets
• Good asset quality underpinned by a diverse investment portfolio supported by sound risk management practices
• Sound asset-liability management practices contribute to an overall strong liquidity profile
• Sound risk management practices support strategic objectives

Constraining Factors

• High reliance on institutional funding, though declining

Rating Sensitivity Factors

Factors that could, individually or collectively, lead to an improvement in the ratings and/ or Outlook include:

• Improving business conditions over the next 12-15 months, resulting in ROA of above 3% and ROE of above 8%
• Management of its funding concentration risk such that less than 50% of its funding is derived from BSL’s top 10 clients over the next 12-15 months

 Factors that could, individually or collectively, lead to a lowering of the ratings and/ or Outlook include:

• _{A deterioration in the credit rating of the sovereign over the next 12-15 months leading to increased liquidity pressures}
• _{Funding withdrawals from its top 3 institutional investors}

COMPANY BACKGROUND

Bourse Securities Limited (BSL or the Company) was founded in 1995 in Trinidad and Tobago (T&T) and is privately owned. BSL is a registered broker-dealer, underwriter and investment advisor registered with the Trinidad and Tobago Securities and Exchange Commission (TTSEC). The Company offers a range of products and services, including mutual fund management, securities brokerage, securities underwriting, wealth management, investment advisory services as well as the provision of short-term fixed return investment products such as repurchase agreements. BSL has three (3) branches across T&T, with locations in Chaguanas, Port of Spain and San Fernando.

BSL’s suite of products includes TTD and USD Mutual Funds including its flagship SavInvest India Asia Fund (SIAF), SavInvest Individual and Group Retirement Funds, and Repurchase Agreements. BSL also extends the service of Bond Brokerage and Wealth and Portfolio Management.

The Company currently holds four (4) wholly owned subsidiaries namely: Bourse Brokers Limited (BBL) – a member of the Trinidad and Tobago Stock Exchange (TTSE) and the stockbroking arm of the business, Bourse International Asset Management (BIAM) – an international business corporation (IBC) domiciled in St. Lucia primarily focused on asset management, Windsor Investments Limited incorporated in St. Lucia on December 27, 2018 and Alkene Development Company of Trinidad & Tobago (ADCOTT), with a focus on research and development.

Analytical Contacts:

Megan Dass

Tel: 1-868-627-8879 Ext. 239

E-mail: mdass@caricris.com

Keith Hamlet

Tel: 1-868-627-8879 Ext. 244

Cell: 1-868-487-8356

E-mail: khamlet@caricris.com

Website: www.caricris.com

E-mail: info@caricris.com

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.

 RATING DRIVERS

Supporting Factors

• Competitive advantage lies in its affiliation with the NCB Financial Group
• Good financial performance supported by continued profitability
• Continued good asset quality notwithstanding a slight deterioration in the NPL ratio, it remains below that of the local industry
• Comfortable capitalisation reflected in strong capital adequacy ratios and low leverage
• Stable funding base, though small, adequately supports operations

Constraining Factors

• Small player in a highly competitive market
• Asset/ Liability maturity mismatch heightens short-term liquidity and refinancing risks

• Small player in a highly competitive market
• Asset/ Liability maturity mismatch heightens short-term liquidity and refinancing risks

Rating Sensitivity Factors

Factors that could, individually, or collectively lead to an improvement in the ratings and/ or Outlook include:

• The successful rollout of the Company’s income rebalancing strategy leading to a greater contribution to total income from its Retail and Business Banking Division to over 40%
• A reduction in the reliance on institutional funding to under 50%
• Sustained increase in profitability of 10% over the next 3 years

Factors that could individually, or collectively lead to a lowering of the ratings and/ or Outlook include: 

• Declining asset yields or rising funding costs, leading to a material contraction in spread income to below 1% over the next year
• A systematic increase in liquidity pressures in the environment, leading to funding withdrawals in excess of 50% from large institutional investors, and a worsening of short-term TT$ liquidity measures over an 18-month period
• Deterioration in the Parent’s (NCBCML) credit rating that could materially impact the extent of credit support available to NCB Merchant

• •  
  • COMPANY BACKGROUND

     NCB Merchant Bank (T&T) Limited (“NCB Merchant or the Company”) (formerly NCB Global Finance Limited or NCBGF) was incorporated in the Republic of Trinidad and Tobago on 5 November 1982 and commenced operations in January 1983 as AIC Finance Limited. Effective 11 August 1993, the Company was licensed as a financial institution under the Financial Institutions Act 1993, to conduct the following classes of business: finance company, confirming house/ acceptance house, leasing corporation, and mortgage institution. On 26 August 2003, the Company was licensed by the Central Bank of Trinidad & Tobago (CBTT) as a merchant bank and thus permitted to engage in foreign exchange dealing.

     Analytical Contacts:

  •  Keith Hamlet

     Tel: 1-868-627-8879 Ext. 229

     E-mail: khamlet@caricris.com

     Maxwell Gooding

     Tel: 1-868-627-8879 Ext. 229

     E-mail: mgooding@caricris.com

     Website: www.caricris.com

     E-mail: info@caricris.com

    Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.

  •  

CariCRIS reaffirms overall ‘good creditworthiness’ ratings for NCB Merchant Bank (T&T) Limited

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RATING DRIVERS

Supporting Factors

• Strategic importance to the Government of Jamaica in the divestment of state assets and the allocation of capital to strategic investments
• Strong capital base supported by healthy capital adequacy ratio and good liquidity metrics
• Sound risk management framework supports strategic planning and business processes
• Comfortable financial performance as evidenced by continued profitability and asset growth albeit at lower levels

 Constraining Factors

• High sovereign risk exposure with an elevated level of economic uncertainty

Rating Sensitivity Factors:

Factors that could, individually, or collectively lead to an improvement in the ratings and /or outlook include:

• An uplift in the creditworthiness of Jamaica, where DBJ derives 100% of its revenue, with an attendant improvement in business prospects for DBJ as well as improved profitability and loan portfolio quality
• Increase in ROA in excess of 3.5%, sustained over a 3-year period

Factors that could, individually, or collectively lead to a lowering of the ratings/or outlook include:

• A reduction in funding by more than 25%
• Interest rate spread falls by more than 150bps
• A lowering of the creditworthiness of Jamaica

Development Bank of Jamaica Limited (DBJ) is a limited liability company domiciled in Jamaica and 100% owned by the Government of Jamaica (GOJ). It was formed on April 1, 2000, from the merger of the operations and selected assets and liabilities of the National Development Bank of Jamaica Limited and the Agricultural Credit Bank of Jamaica Limited. DBJ expanded further on September 1, 2006, when it took over the operations and selected assets and liabilities of the National Investment Bank of Jamaica Limited. DBJ has a 50% shareholding in Harmonization Limited, a property development company.

DBJ’s mandate is to facilitate economic growth and development in Jamaica by providing:

• Appropriate medium and long-term developmental financing solutions, particularly to micro, small and medium-sized enterprises through alliances with Approved Financial Institutions (AFIs) and Micro Finance Institutions (MFIs)
• Direct lending to strategic projects identified for their economic growth potential
• Management oversight of the Government’s Privatization and Public-Private Partnerships Programme and transactions
• An ecosystem conducive to venture capital as well as serving as an anchor investor in venture capital funds that operate in Jamaica.

Analytical Contacts:

Nadia Sanchez

Tel: 1-868-627-8879 Ext. 229

E-mail: nsanchez@caricris.com

Anelia Oudit

Tel: 1-868-627-8879 Ext. 226

Mobile: 1-868-487-8364

E-mail: aoudit@caricris.com

Website: www.caricris.com

Email: info@caricris.com

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.

RATING DRIVERS

Supporting Factors

• Affiliation with the JMMB Group supports the growth and sustainability of JMMBIL
• Parental Guarantee to support debt servicing if needed
• Continued good financial performance underpinned by good asset returns
• Favourable resource base and adequate capitalization

Constraining Factors

• Structural subordination of cash flows and refinancing risk may apply given the bond’s structure
• Exposure to the downside risks of the Jamaican and Trinidad and Tobago economy

Rating Sensitivity Factors

Factors that could, individually or collectively, lead to an improvement in the Ratings and/or Outlook include:

• An improvement in the GOJ’s credit rating over the next 12-15 months
• An improvement in the credit rating of JMMBIL’s parent JMMB Group Limited

Factors that could, individually or collectively lead to a lowering of the Ratings and/or Outlook include:

• A deterioration in the GOJ’s credit rating over the next 12-15 months
• A lowering of the ratings of JMMBIL’s parent JMMB Group Limited
• A deterioration below the regulatory requirements for all operating subsidiaries in their respective jurisdictions as determined by their regulators

JMMB International Limited (JMMBIL or the Company) was initially incorporated and domiciled in St. Lucia and was redomiciled in Barbados in February 2021. The Company is a wholly owned subsidiary of JMMB Group Limited (JMMBGL or the Group). JMMBIL forms part of the investment management arm of the JMMB Group and currently holds a portfolio of (long term value) investments, mainly comprising of Government of Jamaica (GOJ) bonds and corporate bonds.

In June of 2020, JMMBIL issued a bond in the amount of US $120 million, in 2 equal tranches of US $60 million each, maturing in June 2023 and June 2025. The bond issue facilitated the direct transfer of 22.5[1]% equity ownership of Sagicor Financial Company (SFC)^[2] to JMMBIL from JMMBGL, with the bond issue being fully guaranteed by JMMBGL^[3]. Each tranche is being serviced through semi-annual interest payments, with principal repayments to be made be by way of bullet payments upon the maturity of each tranche. This transaction was executed as a non-cash transaction and was fully subscribed. Following the transaction, the ownership of SFC shares accounts for around 57% of JMMBIL’s overall earning assets portfolio.

Over the next 12 months, JMMBGL intends to apply for a securities dealing license for JMMBI in Barbados, where it is currently domiciled. This will allow JMMBGL to execute its regional growth ambitions and further diversify its revenues.

[1] Stake held in SFC has subsequently increased to 22.73% due to share buy backs

[2] Sagicor Financial Company (SFC) is rated CariAA by CariCRIS Limited

[3] JMMB Group Limited (JMMBGL) is rated jmA+ (Local Currency Rating) and jmA (Foreign Currency Rating) on the Jamaica national scale.

Analytical Contacts:

Nikkel Collymore

Tel: 1-868-627-8879 Ext. 240

E-mail: ncollymore@caricris.com

Keith Hamlet

Tel: 1-868-627-8879 Ext. 229

E-mail: khamlet@caricris.com

Website: www.caricris.com

Email: info@caricris.com

Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.