How can a bank most Caribbean people have never heard of suddenly become the biggest bank in the English-speaking Caribbean?
That’s exactly what’s set to happen after Bermuda-based Butterfield agreed to acquire CIBC Caribbean in a deal worth approximately US$1.8 billion.
The transaction would create a banking group with roughly US$29 billion in assets.
For comparison, Jamaica’s NCB Financial Group has assets of approximately US$14 billion, while JMMB Group has roughly US$7 billion.
And while Sagicor Financial manages more than US$25 billion in assets across its insurance, pension, investment and banking businesses, it’s not primarily a bank.
Speaking on Taking Stock, CIBC Caribbean CEO Mark St. Hill, said this…
“… will be the biggest bank in the English-speaking Caribbean.”
“The closest bank to come to that is Scotia Caribbean and I think that would still be shy a good US$8 billion.”
-Mark St. Hill
CEO, CIBC Caribbean
But for many Caribbean consumers, the announcement came with one obvious question: Who exactly is Butterfield?
Founded in 1858, Butterfield is one of the oldest banks in the Western Hemisphere. It’s headquartered in Bermuda and has traditionally focused on wealth management, trust services and private banking, with operations in Bermuda, the Cayman Islands and other international financial centres.
But St. Hill says the relationship between the two institutions goes back many years.
The new group would operate across 11 Caribbean jurisdictions and several international markets, making it larger than Trinidad-based Republic Financial Holdings and giving it one of the broadest regional footprints of any Caribbean banking institution.
The deal is still subject to regulatory approval and is expected to take about a year to close.
Customers are not expected to see immediate changes, although the CIBC name will eventually be replaced by the Butterfield brand.
But the bigger story may be what this says about Caribbean banking.
While Canadian banks have been reducing their presence in the region, Butterfield is making one of the biggest bets on the Caribbean we’ve seen in years.
And that’s the Bottom Line.
So what do you think? Before this story, had you ever heard of Butterfield Bank? And do you think this deal is good for the Caribbean?
