Jamaica Mortgage Bank divestment delay via Jamaica Stock Exchange attributed to legislation

 


Edison Galbraith, Acting General Manager of the Development Bank of Jamaica told Jamaica Money Daily on January 30, 2025, that a delay in the planned divestment of the Jamaica Mortgage Bank via the Jamaica Stock Exchange is due to the need to repeal old laws and other processes underway.


Galbraith, in his update, outlined, “The Development Bank of Jamaica (DBJ), on behalf of the Government of Jamaica (GOJ), is in the process of privatising the Jamaica Mortgage Bank (JMB), having received the Cabinet's approval of the recommended transaction structure in 2024.

“The approved strategy is currently being implemented, which includes the repeal of the relevant legislation to facilitate listing of the privatisation vehicle on the Jamaica Stock Exchange; tender and identification of a strategic investor, as well as the divestment of the mortgage insurance portfolio administered by JMB on behalf of the GOJ. “

In June 2018, the Cabinet approved an Accelerated Rationalisation Programme (ARP) which involves the rationalisation of 48 public bodies including the listing of shares in relation to the operations of the Jamaica Mortgage Bank.

However, seven years later, the process is still underway. Meanwhile the government, in January 2025 announced a new project, which is the divestment of the GoJ’s TransJamaican Highway Limited via the Stock Exchange also.

The Jamaica Mortgage Bank, established in 1971, has the mandate to finance affordable housing so that all Jamaicans will have access to home ownership. The company seeks to mobilize financial resources for on-lending to developers.

The JMB was the third company and government agency listed for privatisation by the government of Jamaica. Other companies divested include Wigton Windfarm Limited and TransJamaican Highway limited, transactions which netted the state billions from sale of shares to the public.

In 2022, the DBJ indicated that that following the completion of due diligence assessments including valuation and legal opinions with consultants, the DBJ, on behalf of the JMB Enterprise Team, recommendations have been submitted to the Ministry of Housing Urban Renewal, Environment & Climate Change “to seek Cabinet's approval of the recommended transaction structure for the privatisation.”

It was then stated, “Once Cabinet approval of the recommended transaction structure is received the Development Bank of Jamaica and the JMB Enterprise Team will implement the approved strategy including completion of the preparation of the prospectus in preparation for the application for listing on the Jamaica Stock Exchange.”

At the end of the year 2019/2020, JMB had a total of 17 projects at various stages of completion, with cumulative commitments amounting to $6.2B to construct an aggregate 499 housing solutions, or an average of $365M to construct an average of 29 solutions altogether.

The Bank also disbursed approximately $1.2B to fund new commitments as well as finance the completion of approximately 60 solutions carried over from previous periods.

Caribbean Money Daily

Caribbeanmoney.blogspot.com

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