KINGSTON, Jamaica–In a first-of-its-kind move, Jamaica’s largest credit union has introduced shares on the main market of the Jamaica Stock Exchange.
Community & Workers of Jamaica Co-operative Credit Union, C&WJCCU, listed 450 million units of its 7.35% Variable Deferred Shares, “signifying a milestone in a two-year process of rules changes and accommodations that have broken new ground,” according to JSE Group Managing Director Marlene Street Forrest, reported the Financial Gleaner.
“This is the first time in the history of the Jamaica Stock Exchange that we are listing a security of an organization that is not issued by a company, and which is not incorporated under the Companies Act of Jamaica or another approved jurisdiction,” Street Forrest said, according to the Gleaner.
Street Forrest said the stock market rules had to be adjusted to accommodate the new listing as an “approved entity.”
“Approved entity means an industrial and provident society, a cooperative society, a building society, a statutory corporation, collective investments schemes, or any other entity and/or corporate structure enabled by governing legislation and approved by the exchange,” the Financial Gleaner quoted Street Forrest as saying.
CU Numbers Are Reduced
The Gleaner noted credit unions were designated “defined financial institutions” under a Finance Ministry regulatory amendment in 1999, which led to a raft of organizational and structural changes among the more than 60 credit unions at the time. Now there are only 25 CUs remaining in Jamaica.
“Also in the mix was preparation for credit unions to be regulated by the Bank of Jamaica, replacing the self-regulatory ethos, which obtained since the first credit union emerged in 1940-41,” according to the report.
Along with mergers, credit unions have had to restructure their balance sheets and reclassify the types of shares that their membership can hold.
“The new requirements allow for a portion of members’ shares to become fixed or permanent and, as such, treated as equity, as well as a voluntary pool of shares which would be treated as deposits,” Registrar of Cooperative Errol Gallimore told the Financial Gleaner ahead of the C&WJCCU listing.
The deferred shares being listed, although part of the credit union’s capital adequacy requirements, do not affect the ownership structure of C&WJCCU, union where each member regardless of the number of shares, has one vote, Gallimore told the Financial Gleaner.
The ‘Impossible’ Possible
Describing the two-year journey in getting the shares listed, CEO Carlton Barclay, “in an apparent dig at naysayers,” said that with the help of several partners the credit union made the “impossible” possible, the Gleaner reported.
“It can’t be done, is what we have heard or it is impossible under these rules. Well, it has been done,” Barclay told the publication. “Being listed on the JSE is a giant step forward in bringing C&WJ – and indeed the credit union movement – into the 21st century financial world.”