Key Points:

•Sygnus Credit plans to extend Class C and D preference shares maturity to December 2028 and lower dividends to 9.85 per cent and 7.50 per cent, simplifying the process and cutting costs.

•The extension would save about $10.4 million and US$83,900 annually, reflecting lower interest rates since December 2023 issuance.

•SCI’s income rose 17 per cent and net profit grew 60 per cent through March 2025, with assets up 15 per cent and credit ratings reaffirmed as ‘adequate’.

SYGNUS Credit Investments Limited (SCI) will approach preference shareholders within the coming weeks to seek a three-year extension on two classes of preference shares which are set to mature on December 22.

The private credit firm published a notice on Wednesday that it will have a general meeting for owners of the class C (10.50 per cent J$) and class D (8.00 per cent US$) cumulative redeemable preference shares on August 26. Both meetings are to take place at the Rocksteady Ballroom by the AC Hotel Kingston.

Sygnus Credit wants to extend the maturity of both preference shares by an extra three years to a new maturity date of December 2028 and adjust the rates on both preference shares. The class C preference shares would have its dividend yield adjusted from 10.50 per cent to 9.85 per cent, while the class D preference shares would have its dividend yield adjusted from 8.00 per cent to 7.50 per cent. Usually, an issuer like Sygnus Credit would redeem the maturing preference shares and issue new ones to investors seeking a return on their money.

“For the upcoming maturity of the Class C Shares, we have opted for a more efficient and investor-friendly approach by amending the terms of the existing shares rather than issuing new ones. This approach avoids the time-consuming and administratively burdensome process of launching a new issuance, which would require investors to complete fresh application forms and submit supporting documentation,” Sygnus Credit explained in its shareholder advisory.

SCI originally raised a gross amount of US$50.37 million across three class of preference shares in December 2023. The class C and class D preference shares are currently set to mature in December, as per the original terms. The face value of the class C preference shares is $1.6 billion (US$9.92 million), while the class D preference shares have a face value of US$16.78 million. The class C preference shares were issued at $100 per share while the class D and E preference shares were issued at US$10 per share.

If preference shareholders were to approve these new terms, SCI would save an extra 65 basis points (0.65 per cent) or $10.40 million (US$64,494) annually on its class C preference shares and save 50 basis points (0.50 per cent) or US$83,904 on its class D preference shares. SCIJMD10.5C (Class C) traded at $102 on Wednesday while SCIUSDUSD8.00D (class D) traded at US$9.65.

“The revised pricing for the Class C Shares has been structured to maintain attractive returns for investors, in light of prevailing market conditions. At the time of the Offer, the Bank of Jamaica’s policy rate stood at 7.00 per cent, and Government of Jamaica Treasury Bills were yielding between 7.91 per cent and 8.42 per cent. As of June 2025, the policy rate has declined to 5.75 per cent, and by July 2025, Treasury Bill yields have fallen to between 5.19 per cent and 5.37 per cent,” SCI explained in its rationale for the class C preference shares.

SCI also added that the three-year US treasury yield was 4.80 per cent in late 2023 compared to 3.90 per cent in July 2025. This explanation relates to the class D preference shares.

Sygnus Credit is just the latest public company to approach its shareholders for an extension of its listed preference shares. JMMB Group Limited (JMMBGL) extended four classes of preference shares over the last two years. It extended JMMBGL10.00 valued at $3.697 billion to March 2032 and adjusted the interest rate from 7.25 per cent to 10.00 per cent, with the rate resetting every March. JMMBGLUS7.50, with a face value of US$42.53 million, was extended to March 2031 and had its interest rate changed from 5.75 per cent to 7.50 per cent. JMMBGL extended two preference shares in January 2024 to January 2030 with face values of US$42.78 million and $1.83 billion.

JMMB Group facilitated an order book for both extensions, whereby investors who wanted their principal back were matched with other investors that wanted to lock in higher interest rates.

Productive Business Solutions Limited (PBS) redeemed its 9.75 per cent listed preference shares valued at $2.58 billion (US$16.59 million) in June 2024 but issued US$17 million worth of preference shares in June 2024 with a four-year duration and 8.25 per cent interest rate. Eppley Limited redeemed its 6.00 per cent listed preference shares valued at $500 million in December 2024 but issued $535 million worth of preference shares with a 11.50 per cent interest rate and five-year duration.

Even the recent $5.43 billion public bond offering by VM Investments Limited (VMIL) saw $3.11 billion or 57 per cent of the offer coming from the reinvestment of bonds that matured in December 2024. Mayberry Investments Limited redeemed $2.282 billion or tranche III (11 per cent) of its bond on January 20 but issued a new public bond in March worth $3.46 billion and an interest rate of 10.25 per cent.

Sygnus Credit’s income for the nine months period ending March 31 increased 17 per cent to US$12.36 million as it benefited from higher interest income and fair value gains. Despite a 12 per cent rise in expenses to US$5.05 million, the consolidated net profit grew 60 per cent to US$6.97 million. This exceeds the net profit achieved for the June 2024 financial year. Sygnus Credit’s June 2025 audited financials are due by August 29.

SCI’s asset base grew 15 per cent over the nine months to US$228.41 million, with investments worth US$214.63 million. Total liabilities and shareholder’s equity was US$152.55 million and US$75.86 million, respectively. The Caribbean Information & Credit Rating Services Limited (CARICRIS) reaffirmed the ‘adequate’ creditworthiness of SCI with a CariBBB- and jmBBB+ credit rating.

Sygnus Credit raised US$32.97 million in December 2024 by issuing perpetual cumulative redeemable preference shares with class H (10.00 per cent) valued at $1.71 billion (US$10.62 million) and class I (8.00 per cent) valued at US$22.05 million). These shares don’t have a defined maturity date but can be redeemed at future intervals.