First Citizens investments looking to cash in on excess liquidity
A Trinidad-based investment services company is about to roll out some initiatives to mop up the excess liquidity in the Barbados market.
Acting general manager of First Citizens Investment Services Sana Ragbir told Barbados TODAY that there were a lot of people on the island who were looking for investment and the company was about to take advantage of those opportunities.
At the same time, she said, the company was finding it difficult to invest in Barbados given the state of the economy.
“We see that people have a lot of Barbados dollars to invest, and given where the economy is and where interest rates are, you find that there is a lot of excess liquidity . . . so, in this space we see some opportunities to offer new products, new managed portfolios, etcetera, rather than the traditional fixed deposits or mutual fund products,” said Ragbir.
However, she noted: “Given what has been going on in the Barbados economy recently and the excess liquidity, it has been difficult for us to really invest funds. So, even if we take in funds from clients it has been really difficult for us to invest or find securities to invest in because really all we are seeing are Government of
Ragbir disclosed that the company was working on rolling out a managed account portfolio in the Barbados market in order to get more people to invest.
“We basically analyze your risk tolerance, we go through your investment objectives with you and then we determine what is your appropriate asset allocation,” she explained.
Ragbir said there had been a noticeable increase in the number of credit unions and small businesses seeking investment services from First Citizens.
That, she said, was another opportunity for the company to introduce new advisory services. However, she did not say how soon the initiatives would
come on stream.
Meantime, Ragbir said while downgrades of Barbados’ credit ratings have not affected First Citizens Investment Services’ exposure, the company was not letting its guard down.
“We have been looking at it and we have analyzed the Government . . . Actually, what we have done is to keep our investment very short term in the Government of Barbados – one-year Treasury Bills, etcetera,” she said.
However, Ragbir said based on observations, she was optimistic that things would improve this year, especially in the tourism sector.
“So that is definitely one thing we have to look at and reassess our position, and definitely see if we can go out longer on the Government of Barbados [issues] now,” she said.
Ragbir suspected that with the introduction of the tax on asset, credit unions and other financial institutions would have to “reassess” and “rebalance” their portfolios, and that was something First Citizens Investment Services had been preparing for over the past two years.