PETER Bunting’s new finance house is to follow Barita Investments and list on the Jamaica Stock Exchange (JSE) early in the new year, taking the number of listings to 46. The Initial Public Offering (IPO) is expected to be announced over the coming weeks.

Earlier this week it was announced that NCB Capital Market’s managing director Christopher Williams will be stepping down at the end of December to participate in a somewhat smaller venture in the financial sector. That venture will see the former lead principals of Dehring Bunting & Golding (DB&G), Peter Bunting, Mark Golding and Gary Sinclair again teaming up with Christopher Williams and a number of bright young stars operating in the local financial sector.

A party close to this new investment outfit speaking with Caribbean Business Report from abroad said: ” We felt the competitive urge returning and the non-compete clause from the Scotia deal ends sometime next week. We have had time to evaluate what is happening on the local financial landscape. This will not be another DB&G but we will be equally innovative and cutting-edge.

“We will shortly announce an IPO and then list on the JSE. We will not be a securities dealer but rather will focus on US dollar-denominated investments for those who favour a robust risk-averse infrastructure. Christopher Williams has done a fantastic job at NCB Capital Markets and made that organisation the one to emulate. He will join us as a senior member of the team and his expertise will be invaluable to us.”

The member of the new team went on to say that the model is fashioned to obviate the need for a heavy investment in brick-and-mortar structures, and instead emphasis will be placed on an efficient administration where returns go right back to shareholders as opposed to a balance sheet which is heavily weighted towards operating costs. The aim is to see that investors get better yields on hard currency instruments.

“The capital markets are reviving but no one is going near Jamaican-dollar global bonds primarily because they are deemed at low investment grade. We will aim to attract well-heeled investors looking for higher yields from US dollar and other hard currency instruments. Jamaican-dollar global bonds will not dominate our portfolio because quite frankly, there is not a huge demand for them and there is a degree of overexposure,” said the player in the new venture.

The recurring question heard this week is, how will this new entity be financed and what will be the debt/equity mix?

Informing that answer is the fact that in 1992 the founders of DB&G raised US$1.5 million to begin its operations and then sold the company to Scotia Group in 2007 for US$100 million. Another question mooted is, why start this venture at a time which sees a global recession akin to the Great Depression and when the world of finance has proven to be topsy-turvy and very unstable?

Speaking at a Jamaica College Old Boys’ Symposium last year, Peter Bunting said: “I must say that the Jamaican business environment has always been turbulent. I cannot recall a period when it has been tranquil and the conditions conducive to business.

There has always been high crime, economic volatility, and Jamaica continues to be vulnerable to external shocks whether it be the world market or the weather.

“We started DB&G intending it to be a corporate finance boutique to raise capital through corporate bonds and equities issues. Within six months of starting the company the stock market crashed and real interest rates became so high that blue chip companies would not borrow.

“Thus it became necessary to “change course” so to speak and try to find another revenue stream to tap. The first couple of steps were costly missteps, then we had one success. We started making loans, reverting to our banking background.”

Perhaps the more pertinent question should be, how will this latest decision reconcile itself with both Golding and Bunting’s parliamentary responsibilities?

Bunting serves as a member of parliament and the shadow spokesman for National Security, and Mark Golding as a senator and opposition spokesman on commerce and industry. Both men are tipped to form the spinal column of the People’s National Party’s leadership core over the coming years.

So what will be the formation of this “galacticos”, this all-star team, and how will it all come together?

“The governance structure will be conducive to the robust risk- management focus that is going to be a critical component of the model we are contemplating. It will leverage the individual strengths of the players involved,” said a senior member of the new finance house.