The collapse, or something near to that, of core parts of the Lawrence Duprey's Trinidad-based CL Financial group should, we believe, place urgently back on the regional agenda the need for the harmonisation of financial services regulations and a close collaboration among regulatory agencies, if not a single oversight body.

Our central point is that, while it is the Trinidad and Tobago government that is most immediately exercised concerning the CL crisis, with the potential of having to plug a TT$8-billion or more (J$94 billion) deficit in the group's accounts, this is not merely a Trinidadian problem. Should things be worse than they currently appear to be, Jamaica could feel a substantial pinch from the fallout. So, too, would most other Caribbean Community (Caricom) member states.

Talented entrepreneurs

Lawrence Duprey is one of the Caribbean's most talented entrepreneurs. In the last two decades or so, Colonial Life Insurance Company (CLICO) from the sleepy little insurance company founded by his uncle, Cyril Duprey, to being, by English-speaking Caribbean standards, a mega group with its tentacles in the far reaches of the world. It holdings include banking and finance, energy and spirits. The assets of this privately held conglomerate, but some of whose entities are worth over TT$100 billion listed, are on the books.

Some of those assets, as well as liabilities, are in Jamaica. For instance, last year, CL, through its subsidiary Angostura Ltd, purchased the Jamaican conglomerate Lascelles de Mercado for US$700 million, a portion of which it financed with a US$40-million bond floated on the Jamaican market and backed with Lascelles shares. CL holds 40 per cent of local bond traders Jamaica Money Market Brokers (JMMB), over which, admittedly, it has no management control.

At the same time, JMMB, until last September, held 40 per cent of Caribbean Money Market Brokers (CMMB), a Trinidad counterpart, which it owned with CL. Duprey's acquisition of JMMB's stake was a timely liquidity cushion for the Jamaican company.

Big player

Significantly, CMMB was among the CL subsidiaries into which the Trinidadian government intervened last week. The others were CLICO, Clico Investment Bank and British American Insurance Company.

No one is as yet certain if, or to what extent, there has been an intermingling of CL group assets and/or inter-company lending that might have placed at risk entities in Jamaica, Barbados or elsewhere in the Caribbean where CL is a big player. Indeed, Caribbean governments have to be wary of the possibility of CL contagion, a prospect made greater by the Caricom Single Market and Economy (CSME) - the effort by Caricom to establish a seamless economic space.

CL is not the only regional company with cross-border holdings. For example, the Trinidadian-based Guardian Insurance Holdings is big across the Caribbean, including Jamaica, and Michael Lee Chin substantially holds his National Commercial Bank through a Barbados-registered vehicle, AIC (Barbados) Ltd. These, of course, are not all, but point to the need for an effective regional regulatory mechanism about which Caricom has long talked, but done little.

Indeed, we believe that Caricom leaders should convene an emergency summit to fashion a regional response to the global economic crisis, but which should have as part of its agenda, the CL and regional regulatory issues.

The opinions on this page, except for the above, do not necessarily reflect the views of The Gleaner. To respond to a Gleaner editorial, email us: editor@gleanerjm.com or fax: 922-6223. Responses should be no longer than 400 words. Not all responses will be published.