Article by Mark Kappart

The nightmare never seems to end for NCB.

Its stock price seems to be in freefall, and has now entered the J$20-J$30 range. On Friday (July 25), it hit a new low of J$29.

NCB Financial Group is heavily indebted, and its chairman and majority shareholder, Michael Lee-Chin, has used his shares in Jamaica’s largest financial institution to collateralise a number of bonds that are coming due. In some cases, he has asked for a longer period to repay. He has also disposed of a number of personal assets to make good on commitments.

Earlier this week, NCB moved to drum up support for its raise on the international capital markets, where it is looking for US$300 million

Then followed news that it had pledged its shares in regional insurance giant, Guardian Holdings, as collateral for its delayed bond. NCB really needs that bond to come good right about now.

NCB has to honour a US$250 million debt obligation this year and therefore has to move quickly to cover that position.

The most recent bond, however, remains unpriced, and the uncertainty surrounding NCB may have impacted the share price. Then again, this may be a great time to snap up NCB and wait for the price to go up again.

If Michael Lee-Chin continues to use his shareholding in NCB as collateral, can he continue to maintain control? It does put him in a tenuous position if the share price continues to slump. What if bondholders decide it’s time he forfeit his shares to make good on obligations? What then? 

Then there is the confidence aspect. Last year, NCB only got J$2.5 billion of the J$5 billion it was after with its APO. Those who bought at J$65 have taken a hit and remain unhappy. It is doubtful now whether Jamaica’s capital markets would be favourable to NCB.

Of late, there has been a slew of bad news about NCB, with some saying the fish rots from the head down. Maybe the upcoming release of its nine-month 2025 results on August 7, will provide the spur that it needs to get it out of the doldrums. 

This has been the summer of NCB’s discontent.

Michael Lee-Chin and the senior management team at NCB Financial Group have to move expeditiously to change its fortunes and dispel this pall of negativity.

It is unfathomable that in 2019, NCB was riding high at J$210 and on Friday (July 25) closed at J$31 after hitting a low of J$29.