The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Deltec Bank & Trust last night said it will become “one of the largest international private banks in The Bahamas” with its acquisition of rival institution Ansbacher (Bahamas).

The western New Providence-based provider, in a statement responding to Tribune Business inquiries, said the merged group will drop the Ansbacher brand and take the Deltec name once the purchase is completed and Central Bank and all other necessary approvals received.

With Ansbacher (Bahamas) set to provide $7bn in additional assets under management, Deltec said the acquisition was motivated by its need to acquire “scale” and “reach” to enable it to better compete in a digital banking niche that it has invested heavily in during recent years.

“Over the past few years, Deltec has invested in its digital banking technology and positioning itself for the future of banking,” Deltec told this newspaper.

“As a part of Deltec’s growth strategy and launch of new digital banking platforms, the bank sought to expand its reach and capacity – specifically by combining expertise, systems and networks through the acquisition of Ansbacher [so as] to be well-positioned for the bank’s expected growth.

“Deltec will consolidate both entities under the Deltec name and brand, undoubtedly making the bank one of the largest international private banks in The Bahamas in size and assets under management,” it added.

“Until the transaction is complete, both Deltec and Ansbacher will continue to operate as separate entities. Both entities have only recently executed the share purchase agreement. Deltec is actively engaged in getting the necessary regulatory approvals. However, we are committed to closing as soon as possible.”

Deltec did not respond to Tribune Business questions on the purchase price and whether any staff downsizing/redundancies will result once the merger and acquisition complete. However, financial industry sources said it was almost inevitable that some workers will ultimately be let go as two sets of staff will not be required to operate one IT system and platform.

“Oh absolutely,” one contact, speaking on condition of anonymity, said when asked about the potential for downsizing. “They’re going to put that on one platform, and it’s not labour intensive any more. Deltec will be able to absorb that, and not need significant headcount to absorb it. There will be attrition. There’s no doubt about that.”

Ansbacher (Bahamas) current owner, AF Holdings, said in a statement that they had decided to exit the international financial services business to focus on their domestic interests.

Once the deal is completed, the former Colina Financial Group will retain its insurance interests led by Colina Holdings (Bahamas), the BISX-listed life and health insurer, as well as Indigo and the Colina General Insurance agency. Then there is the CFAL capital markets, investment fund and personal financial planning business, plus its Nassau Guardian and related media assets.

AF Holdings’ principals are Emanuel Alexiou and Anthony Ferguson. Mr Ferguson could not be reached for comment last night despite messages being left, but one source said the Ansbacher (Bahamas) sale represented a reversal of the group’s previous expansion-by-acquisition strategy.

“It’s almost like they’ve come full circle,” they added of AF Holdings. “After expanding into everything, they’re now consolidating.” AF Holdings built Colina Holdings (Bahamas) and its insurance subsidiaries into the largest life and health player via an acquisition spree that included Global Bahamas, Canada Life and Imperial Life during the period 2002-2006.

However, Andrew C. Alexiou, Ansbacher (Bahamas) managing director, said in a statement: “AF Holdings has taken the strategic decision to divest its interest in Ansbacher in order to focus on other investments and business interests in The Bahamas. The decision to divest Ansbacher does not impact any other AF Holdings entities or investments.

“Ansbacher’s Board of Directors and shareholders have full confidence that Deltec is well-placed to lead Ansbacher to the next phase of success, continuing to deliver exceptional performance with integrity and professionalism, and working together to play its part in The Bahamas’ economic success.”

AF Holdings itself acquired Ansbacher (Bahamas) as a standalone unit in summer 2009, merging it with its then-Sentinel Bank & Trust. The institution has been part of the AF Holdings group for just over 12-and-a-half years, with Colina Holdings (Bahamas) and its subsidiaries holding a collective 19 percent equity stake in Ansbacher (Bahamas).

While Ansbacher (Bahamas) 2021 financial results have yet to be released, those for 2020 show it suffered a $12.159m total comprehensive loss for 2020 with revenues standing at $25.524m. Net equity stood at $63.396m for the year to end-December 2020.

This followed $7.808m in net profits for its 2019 financial year, and $4.836m for the 12 months to end-December 2018. However, Ansbacher (Bahamas) top-line revenues essentially remained flat over that period, fluctuating between $25.5m and $26.9m.

Deltec said in a statement that the deal fitted its strategy “to add scale, reach and capabilities”. Odetta Morton, Deltec’s chief executive, said: “We pride ourselves in offering unique value to our clients with innovative financial services, grown on traditional roots.

“The imminent acquisition enables us to expand our reach and capacity, as we continue to invest in the future of banking through leveraging our combined expertise, network and services.

“The acquisition brings together two companies with deep knowledge and expertise to create not only one of the largest international banks in The Bahamas and Caribbean, but a globally focused bank – one that creates even more client value, delivering consistent performance.”