Reading Time: 6 minutes

A week to remember.

It was reminiscent of Michael Corleone’s declaration: “Today I settled all family business so don’t tell me that you are innocent. Admit what you did.”

The end for NCB’s leading executives Patrick Hylton and Dennis Cohen was expeditious.

One week they were riding high, the next they were out. That should send a chill to all the top dogs in corporate Jamaica. Today’s success is no guarantee of future performance.

There should be statutes outside NCB’s headquarters on Trafalgar Road in Kingston of both Patrick Hylton and Dennis Cohen for what they accomplished over the last 20 years. They took a bank that was on its knees post-FINSAC and turned it into the country’s leading financial player, taking the number one spot away from Scotia where Bill Clarke ruled imperiously for years.

Many opportunities were given to Jamaican professionals who flourished as NCB’s fortunes grew.

There were those who questioned local bankers at the dawn of the new century and the aftermath of FINSAC. Some said they didn’t have the right stuff. Hylton and Cohen debunked that.

It is sad to see that their legacy will be forgotten and all that will be remembered is how they left in ignominious circumstances. 

They will not walk gloriously into the sunset with their shoulders back and the roar of the crowd in their ears and the gratitude of those they managed. There will be no fanfare and the unfurling of bunting.

Whether fairly or unfairly, they will be painted as fat cats on inflated compensation packages who did not see fit to pay shareholders dividends for years, who presided over the share price falling precipitously from $240 to $62. 

Communication is key in management and corporate leaders should make an effort to foster relationships with the media – you must have access to open channels to disseminate your message.

All too often top financial managers in Jamaica fail to pay adequate attention to this to their detriment.

Hylton and Cohen were a little wooden with the media and have never been that forthcoming. Sure they spoke at AGM’s and some investor briefings but they were never inclined to go beyond that. 

Contrast their stolid yeoman approach with that of their Chairman Michael Lee Chin. Since Lee Chin announced that he was taking a leave of absence, he has been in the press every week, making himself available. It was he rather than his top managers who made it clear that shareholders should receive dividends and that something should be done about it.

He had the antennae to read the situation and then act, allaying fears and addressing concerns. Now he’s reaping the dividends from appreciative shareholders, the Jamaican public and top business journalists.

All Hylton and Cohen had to do was come out and say, we are endeavouring to put in place measures to ensure we pay a dividend, just bear with us, we hear you and we will get there. Instead they said nothing, and the situation festered.

J.P. Morgan’s CEO Jamie Dimon is a fantastic communicator and has a winning way with the media, candid and forthright. He is always speaking on a host of issues and gives it to you straight between the eyes. He continues to say that politics and bureaucracy destroy companies, particularly big ones. He is effusive about the global macroeconomic climate and what he wants to accomplish with J.P. Morgan.

After Hylton was sent home, he then started talking to the media and giving his version of events. Too late. He failed to convey that he was loyal to NCB’s customers and shareholders. 

Lee Chin did that instead and did so in an endearing way.

One of the best communicators in the Jamaican financial sector is Proven’s Managing Director Christopher Williams. From his early days at Dehring Bunting & Golding (DBG) he was effectively able to get his message and intent out there with an amenable personality.

Hylton and Cohen could have done with a little of what Chris has. It’s a disarming quality and a major asset to any finance house.

The NCB top executives came off flat-footed and pedestrian when they didn’t have to. NCB’s communications department must share some of the blame here because they could have assisted in managing the situation. Issuing poorly written press releases is not what communication is about.

If you are aware of your boss’ shortcomings you do your best to mitigate them. That did not happen at NCB.

Both Hylton and Cohen will perhaps protest that they were busy ensuring NCB was adequately capitalised and greater attention paid to risk management, but as top boss, you are expected to ride the horse and chew gum at the same time.

The disgruntlement of shareholders could have been assuaged.  They could have met with Lee Chin and come up with a plan and conveyed that they were all aligned.  To date, it is still not clear who decided shareholders would not be paid dividends. Was that decision made by the board or management?

No one wants to announce to the world exactly what they earn and their level of emoluments. That’s information you’d rather not have out there and that’s understandable.

When it came out that between them Hylton and Cohen raked in J$13.8 billion the vitriol and indignation was red hot. It became a subject of national discussion. They were portrayed as uncaring fat cats only concerned about their pockets and not the equitable distribution of dividends to shareholders. 

In Jamaica, there has always been a lurid fascination with what people earn and depending on the sum it could have dire consequences for your welfare.  Both Hyton and Cohen would be rightfully concerned.

Hylton has said their package was agreed to by the Board and that they did not simply pay themselves those sums. Success should be rewarded, and one should flourish in good times. In bad times you have to tighten your belt and make sacrifices.

It would have behoved the top executives to go to their chairman and say, with the impact of COVID, given the present environment and with no dividends being paid out we will forgo a little of what was promised but do reward us accordingly when the good times roll again. Take one for the team.

Maybe they did. It is hoped that both these chaps didn’t obstinately hold to an advantageous agreement regardless of the fortunes of NCB.

A lesson to take away here is the importance of negotiating your package effectively. All too often many of us settle on what is proposed fearing we can’t do better. But it is incumbent upon us to deliver. For a long time now Hylton and Cohen delivered. It is now expected that they will be made an attractive exit package offer, some say in the region of $3 billion each before they leave the citadel they ruled.

There has been speculation that NCB’s woes go far deeper and that capital adequacy has to be shored up. Let’s be clear here-the institution is sound. Its capital is J$230 billion, up from J$202 billion last year. Its capital as a proportion of total assets stands at a ratio of 8.25 per cent. The Board no doubt would like to see that get into double digits.

It is still the largest financial institution by assets in Jamaica with $2.15 trillion. Its customer deposits last stood at J$720 billion. Last year it posted a profit of J$40 billion.

The majority shareholder, Michael Lee Chin has said that he would like to see greater efficiency, more attention paid to corporate governance and vastly improved customer service.

In the rush to implement digital banking and a greater reliance on technology, something was lost, and customers have become disgruntled. Work will have to be done here and managers will have to find better solutions to make customers happy.