Proven seeks to acquire Fidelity Bank (Cayman) Limited

PROVEN Investments Limited (Proven) has entered into a share purchase agreement with Fidelity Bank & Trust International Limited – a company incorporated in the Commonwealth of The Bahamas – to acquire the shares of Fidelity Bank (Cayman) Limited (FBC) subject to regulatory approval by the Cayman Islands Monetary Authority.

Proven said that the proposed acquisition of FBC is aligned with its strategy of regional growth through acquisitions in the regulated financial services sector throughout the Caribbean and Latin American regions and is aimed at increasing value for shareholders.

Head of the Proven’s banking and wealth division, Johann Heaven, in expressing his excitement about the pending acquisition, said in a news release that the move was not only consistent with the company’s strategic focus, “but supports our outlook of the impending buoyancy of the Caribbean economies on the other side of the coronavirus pandemic. Our focus is to emerge stronger with an aim to take advantage of opportunities that will posit value for all stakeholders.”

FBC is a licensed financial services company incorporated in the Cayman Islands, which has two branches in the Grand Cayman. Providing a wide range of financial services to residents and non-residents, the bank up to the end of September 2020 had total assets in excess of US$350 million.

“FBC is a trusted financial institution, and an integral part of the community, in the Cayman Islands, with a long and fruitful history, including many significant events impacting the Cayman Islands over that time,” said Gowon NG Bowe, CEO of Fidelity Bank & Trust International Limited.

He added that, “The Fidelity Group has carefully considered the potential acquirers of FBC, as [it] addresses the changing dynamics of its shareholders to ensure that there is strength and stability in its successor to carry on the successful traditions of FBC. The group [therefore] looks forward to working with Proven to attain regulatory approvals, complete the transaction, and effect a seamless transition to new ownership.”

The proposed acquisition of the shares of FBC by Proven comes on the heel of its entry into an agreement last December to purchase a 50.5 per cent interest in Roberts Manufacturing – a leading manufacturer of animal nutrition, edible fats and oils in Barbados from the Massy Group.

FBC is one of nine Category ‘A’ licensed banks in the Cayman and one of 6 banks which serves the domestic Cayman market. FBC sold its pension and insurance business (general and health) in August as the bank zeroed in on core banking business. FBC received approval from CIMA in what was a 3-year restructuring operation according to Bowe in an interview with the Cayman Compass.

According to the CIMA’s published data for 2019, retail Category ‘A’ banks had operating income of US $273.9 million ($39.7 billion) and net profits of US $161.5 million ($23.4 billion) with dividend payments of US $103.3 million ($15 billion). Total assets stood at US $16.2 billion ($235.2 billion) with total liabilities of US $14.03 billion ($203.5 billion) which resulted in equity of US $2.2 billion ($31.7 billion).

PROVEN’s normalized net profit had declined by 26 per cent to US$6.31 million ($914.9 million) for the 9 months ended December 31, 2020 due to the decline in net interest income, fees and commission income plus decline in profitability for IFP and Access Financial Services Limited. PROVEN’s asset base closed out the period at US $649.7 million ($94.21 billion) with shareholders equity of $136.2 million ($19.74 billion) for the period. Its C├ęsar and Via real estate projects are expected to be completed by autumn.

Reporting by Kellaray Miles and David Rose