Shareholders of National Commercial Bank Jamaica Limited (NCB) approved the reorganisation of the group to create a holding company for the bank and its stake in Guardian Holdings Limited, an insurance conglomerate based in Trinidad and Tobago.
"The next relevant step in the process is the sanction of the Supreme Court of Jamaica, to be sought. This is to be done in a hearing in open court on February 22nd, 2017," said company secretary Dave Garcia at the bank's annual general meeting (AGM) on Friday.
NCB chairman Michael Lee-Chin said auditors PWC verified that 180 persons voted in favour of the new scheme of arrangement, representing holders of 1.35 billion shares, while four voted against, representing some 6,000 shares.
"I declare the motion carried," said Lee-Chin, whose stake in NCB is held through several vehicles, the primary one being AIC Barbados with 1.24 billion shares or 50.29 per cent ownership.
Ahead of the meeting, NCB released its first-quarter results for December 2016, in which revenue totalled $10.2 billion and earnings $1.45 per share, up from $0.96 per share in the 2015 period.
"It is our best quarter ever," said NCB deputy managing director Dennis Cohen said at the AGM.
The treasury segment made the most for the group at $1.5 billion, followed by its wealth arm at $1.3 billion. "Our focus will be on our new strategic plan by 2020," said Cohen. "We expect another successful year providing value to shareholders."
The bank will pay dividend of 60 cents per share, totalling, $1.48 billion, on February 24.
NCB completed the $28-billion acquisition of 29.99 per cent of Guardian in 2016. Its GHL shares are held in NCB Financial Group (NCBFG), a new company formed a month prior to the acquisition of the GHL shares.
If approved by the courts, NCBFG will become the holding company for NCB and its businesses. The court approval of the new scheme of arrangement will result in the current shareholders of NCB becoming owners of the holding company. The existing shares of NCBJ will be cancelled and shareholders will receive new shares in NCBFG.
The restructuring also aims to facilitate the future expansion of the entity throughout the Caribbean region, said Group Managing Director Patrick Hylton at the AGM.
The scheme will become effective by April 2017, provided it is sanctioned by the Supreme Court.
NCBFG will become the holding company, with National Commercial Bank Jamaica Limited and Summer Success Limited (Trinidad & Tobago) as its two immediate fully controlled subsidiaries. Summer Success will only hold the 29.99 per cent shareholding in GHL.
NCB Investments, NCB Capital Markets Limited, NCB Jamaica Nominees Limited, Data-Cap Processing Limited, West Indies Trust Company Limited, NCB Remittance Services UK Limited, NCB Remittance Services Jamaica, Mutual Security Insurance Brokers, NCB Cayman Limited and NCB Insurance Company will all remain direct subsidiaries of National Commercial Bank Jamaica Limited.