Sabrina N. Gordon, Business Reporter
Dyoll Building in New Kingston. Creditors of Dyoll Insurance in liquidation are failing to collect their entitlements, said liquidator John Lee. - file
The Jamaican liquidator of Dyoll Insurance, John Lee, says a substantial number of the company's creditors are failing to collect their entitlements, resulting in a build-up of funds.
Dyoll has just under $2.8 billion in liabilities to clear, with Jamaican creditors owed about $760 million and Caymanians about $2 billion.
"On average approximately 50 per cent of the creditors have come forward with claims. This is mainly policyholders, which is well over 90 per cent (of all creditors)," said Lee.
Lee is now in the process of distributing a second interim dividend payment of 27 per cent, which started September 3.
The first interim dividend of 12 per cent was made in May, but not all the creditors on the roll have come forward.
"At the moment there is $800 million in cash left in the account/treasury following the two payouts being made," said Wilfred Baghaloo, who is assisting Lee.
Both men work with Price-waterhouseCoopers.
According to Baghaloo, the company is now left with a contingent liability of approximately 50 per cent that will be distributed to what the liquidator considers 'bona fide' creditors - those who came forward with claims - but only if no new creditors show up.
Slow to make claims
"The creditors have been slow in making claims and also in picking up cheques," said Baghaloo.
"There are cheques that have been prepared from the first dividend payment that have still not yet been collected."
The company is also expected to pay out $45.3 million plus interest to local policyholders only, resulting from the sum that was held by the company that is considered to be 'Prescribed Deposit' in accordance with the Financial Services Commission (FSC) and the Insurance Act.
According to the liquidator, only claims that have been admitted by the joint liquidators, which include Kenneth Krys of Cayman, will be considered for participation in the second and Prescribed Deposit payment.
Judgement questioned
Meantime, the liquidators have questioned whether the authorities might have rushed to judgement in taking over the company, saying in hindsight that it might have been a wiser move to strip away the non-performing assets.
The FSC, called for comment, said it would address the matter only after discussions with the liquidators.
Temporary manager, Ken Tomlinson, who was put in charge of Dyoll for three months by the FSC, prior to the appointment of the joint liquidators, said he was satisfied with the job he did, which included the packaging and sale of Dyoll's insurance portfolio.
"I am satisfied with the way things were handled as it relates to the disposal of Dyoll Insurance portfolio to Jamaica International Insurance Company," said Tomlinson.
"We had no dealing with handling of claims."
Tomlinson's appointment was on March 7, 2005. His stint ended June 6.
"Everything was up-to-date and at all times I was under the scrutiny of the FSC and the Ministry," he told the Financial Gleaner.
Dyoll Insurance entered into financial difficulties when the claims from Hurricane Ivan, which hit Jamaica and the Cayman Islands in September 2004, began to mount.
sabrina.gordon@gleanerjm.com
