The following is the presentation by chief executive officer of the Jamaica National Group at the listing of the Community and Workers of Jamaica Cooperative Credit Union Limited (C&WJCCUL) last Friday, July 31.

First of all, I would like to congratulate Carlton Barclay and the team at C&WJCCUL for initiating and executing this revolutionary capital market initiative in Jamaica.

Jamaica and Jamaicans have a long history of capital inadequacy both at the State level and at the individual level. Historically, the capital to fund economic activity was provided by merchants in England to support main industries such as agriculture, and to provide inventory – food and clothing for the enslaved people.

With the decline in agriculture, which was primarily the export of sugar – occasioned by the emancipation of the enslaved people of Jamaica… the need for basic necessities became increasingly obvious.

The absence of financial services, including loans for the construction of homes, fuelled social instability leading to protests across the island and the major upheaval in St Thomas in 1865, when our National Hero Paul Bogle led a march from Stony Gut to Morant Bay in protest about the living conditions and inequity in the island.

In 1865, the Crown Colony Government introduced the Building Societies Act which provided an opportunity for the people of Jamaica to save and thereby create capital for housing needs.

In Britain, at around the same time, the industrial revolution was in high gear, but the negative effects of the transition from agriculture to manufacturing began to expose the inequities in Britain as workers were exploited, and there was an increasing level of child labour and exploitation of the citizens.

Progressive persons advocated for the establishment of co-operatives to enable fair prices for goods and services, and an improvement in working conditions. Among the co-operatives that came out of those historical developments was the credit union movement.

The credit union movement was introduced to Jamaica in 1939 with the arrival of the Jesuit father, John Peter Sullivan, who arrived in Jamaica to assume a teaching position at St George’s College. He immediately recognised that, while the country now had retail banks, which were mainly branches of British or Canadian banks, they were not meeting the needs of the mainly black population. He introduced the first credit union The Sodality Credit Union with an initial capital of US$1.87.

You will note that this followed the mass protest of 1938 arising from poor working conditions, poor wages, and poor living conditions in Jamaica.

The credit unions, which are not-for-profit, member-based organisations, joined the building societies as mutual savings and loans organisations.

The Achilles heel or weakness of these “mutuals” is the inability to raise capital; therefore, a savings instrument to create long-term capital was created by law. That was the deferred share which was deemed regulatory capital.

The Jamaica Stock Exchange was established in February 1969 to raise capital for the development of businesses in Jamaica; and, as we all know, after a volatile start, is now rated as one of the best stock exchanges in the world.

C & W, through its innovation, has created a solution to the challenge of raising capital in a mutual organisation by today’s listing of the deferred shares to redeem existing liabilities, and to raise additional capital for the development of the organisiation.

By this act today, we could be seeing a new day for mutual organisations… as other “profitable” not-for-profit entities may use this approach to raise capital. This initiative could have a profound impact on the credit union movement and the role of the credit union league.

At Jamaica National, we are proud to have been invited to be a part of this historic initiative.

Congratulations to C & W and its managing director, Carlton Barclay, the “change-maker.”