Union Bank of Jamaica

FINSAC has established a new legal and management structure for a number of the financial institutions in which it has an interest. The commercial banks and merchant banks under FINSAC’s control, namely:

• Citizens Bank Limited
• Eagle Commercial Bank Limited
• Island Victoria Bank Limited
• Workers Savings & Loan Bank
• Citizens Merchant Bank Limited
• Corporate Merchant Bank Limited
• Island Life Merchant Bank Limited

have had their business merged into one commercial bank under the name, Union Bank of Jamaica Limited. The total consolidation of these entities and their operations is to be achieved by September 1999 and FINSAC is currently on target with this timetable. The operations of a significant number of departments of all the entities have already been merged.

Union Bank has total assets of $25.9 billion making it the third largest commercial bank in Jamaica. It is anticipated that the merged entity will be divested as soon as practically possible.

 The primary objective behind the establishment of Union Bank of Jamaica Limited is to bring about a highly efficient, stable, and well-managed financial institution to the banking sub-sector. Streamlining the institutions will bring about a number of benefits. Some of these are:

• The elimination of duplication and the alignment of capital expenditures of each institution;

• The facilitation of a systematic rationalisation and integration of key functions and activities;

• A reduction in the challenge of finding appropriate management for multiple institutions by having in one entity a high level of relevant skills and capabilities, which can be shared among the institutions;

• The provision of opportunities for significant cost reduction and the creation of new business required to achieve profitability;

• The creation of the critical mass and scale efficiencies to make the institutions attractive enough to interest potential purchasers and shareholders;

• The use of common technology, which is vital in view of the Year 2000 problem and replacement cost challenges facing these banks and financial institutions.

The management team of Union Bank of Jamaica Limited is organized so as to provide the necessary expertise in the restructuring of the entities and to ensure maximum accountability to FINSAC and ultimately the public purse.

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