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 DB&G Merchant Bank Limited

The Merger

DB&G Merchant Bank Limited came into being in 1998 when leading investment bank Dehring, Bunting & Golding Limited in partnership with FINSAC injected capital into the then Billy Craig Finance & Merchant Bank Limited (“BCFMB”). BCFMB was a privately owned merchant bank licensed to act as a deposit- taking institution and  conduct the business of managing funds on behalf  of investors.  BCFMB operated in 2 locations in the island and operated a cambio business as well.

To gain a merchant bank license and in order to widen their client base DB&G agreed to purchase BCFMB on September 1996.  The agreement was subject to certain conditions which included satisfactory completion of a due diligence exercise.  Through the investigations of Bank of Jamaica and DB&G it was revealed that BCFMB was in fact insolvent and that the security of depositors and other creditors of the institution was threatened.

FINSAC’s Involvement

The merchant bank’s state of insolvency forced DB&G and BCFMB to draft a proposal requesting FINSAC’s involvement. It was believed that without FINSAC assistance the merger would not be realized, with possible adverse repercussions for the financial sector generally, given the general air of uncertainty in the sector.

 In June 1998, after lengthy negotiations, a Joint Agreement was signed between FINSAC and DB&G to re-capitalise Billy Craig to the extent of $148M, through the acquisition of ordinary and preference share capital.   In return for this investment, FINSAC acquired 49% of the ordinary shares of the bank and  $110.9M in 12.5% preference shares. DB&G holds the remaining ordinary share capital of the bank.   FINSAC has three seats on the Board of Directors.

   

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