JNBS members to vote on transition November 14
JUCDA cites potential savings of $600m
THE JAMAICAN Government can save upwards of $600 million on capital expenditure if it follows through on the acquisition of pre-owned vehicles for the police force, according to Lynvalle Hamilton, president of the Jamaica Used Car Dealers Association.
It comes as the Ministry of National Security just JAMAICA NATIONAL Building Society (JNBS) has set November 14 for a special meeting at which members will vote on plans to reorganise the group amid its transition to a commercial bank.
Assuming a vote in favour of the resolution now being circulated, the financial group plans to convert the society to a company to be called JN Bank Limited.
The change is encapsulated in a new Scheme of Arrangement for the entire group that members must also vote to approve at the meeting set to take place at the Jamaica Conference Centre in Kingston. The Supreme Court sanctioned the plan on September 22, and gave the go-ahead for the general meeting to be convened.
Under the restructuring, the 142-year-old JNBS will remain a mutual organisation, continuing the ownership by its members, which will be preserved in a new mutual holding company. That holding company will own all the entities in the overarching JN Group.
“The organisation will separate its non-financial and financial companies, for regulatory purposes, through two subholding companies, which will both be owned by the mutual holding company,” closed bids for the procurement of 200 pre-owned vehicles for the Jamaica Constabulary Force’s fleet.
The tender closed last Friday, following an extension because of the approach of Hurricane Matthew. The number of bids received was not ascertained.
It’s the largest tender for pre-owned vehicles for the JCF, and a switch in procurement policy. The fleet for Earl Jarrett, group general manager of Jamaica National Building Society.
JNBS said in a press release. JN Bank will be the name for the commercial banking side of operation, JNBS told Gleaner Business on Tuesday.
The group’s businesses currently span mortgage banking through the building society, money services, life and general insurance, microfinance, wealth management, and IT services.
JNBS, which is now the top building society in a market of three, will become the third largest of seven commercial banks once the transition is complete. At June 2016, the building society was valued at $142 billion by assets, according to central bank data.
the police is usually replenished by new models.
“The Government is strapped for cash, and if they went in the direction of buying new vehicles, it would be expensive, as one new vehicle costs the price of two or three pre-owned vehicles,” Hamilton told Gleaner Business on Tuesday from his AutoChannel car dealership.
The Ministry of National Security invited qualified preowned motor vehicle dealers to supply pre-owned motor vehicles not older than five years, preferably 2012 models, for use by the JCF. The ministry wants 80 sedan patrol cars and 120 double-cab pickups.
“Depending on the vehicles they choose, they could save a lot,” Hamilton said then responded to Gleaner estimates. “It’s not easy to estimate, but $600 million, yes – or even more – depending on the used cars they buy.”
‘ATTRACTIVE’ TENDER
Kent LaCroix, chairman of the Automobile Dealers Association, a group of newcar dealerships, described the tender as “attractive” and that it could have resulted in newcar dealers seeking to apply by aligning with pre-ownedcar dealers.
“Something like this tender could see them forging an alliance with someone and putting in a bid,” he said, while not stating whether any alliances occurred in actuality. Kent LaCroix, chairman of the Automobile Dealers Association.
LaCroix, who is group special projects manager at Stewart Motors, a new-car dealership, says that while he sees the utility in pre-owned vehicles, new vehicles should be the preferred choice for the police force.
“There are pitfalls with used vehicles, because the force will need to use them 24 hours a day, and the vehicles have to be in tip-top condition,” he said.
The Jamaican Government announced the switch to used cars for the constabulary back in March during a town-hall meeting in Savanna-la-Mar, Westmoreland, where Minister of National Security Robert Montague was reported by state media JIS as saying his ministry could buy 400 used cars for the price of 100 new cars.
The used vehicles are to last for at least three years, said Montague.