The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE National Insurance Board (NIB) has seen "very satisfactory" returns on its overseas investments, its director, Algernon Cargill, telling Tribune Business yesterday that surplus liquidity in the Bahamian financial system was part of the reason it wanted to invest abroad.

The National Insurance Board's (NIB) foreign investment portfolio expanded by $21.9 million to hit $59.4 million by year-end 2011, according to the Central Bank's 2011 annual report.

And Mr Cargill told Tribune Business: "It is important for us to diversify our investment portfolio. The more diversified our portfolio, the more the risk is spread around in the portfolio.

"We have a strategy where we try to invest up to $25 million a year in US dollars, and we seek to diversify in currency as well as in types of investments. The investments we have overseas would be in US equities, as well as Bahamas government issues in US dollars and various sovereign debts, for example the governments of Barbados and Caymanm that we have bought overseas also. We seek to diversify in currency as well as types of investments if you want to have a balanced and well-diversified portfolio."

Mr Cargill added: "The equities abroad appreciates at a faster rate than the equities here. We certainly have very satisfactory returns on our investments overseas, higher than the Nassau Prime rate, and that's another reason we would want to diversify overseas, particularly because of the surplus liquidity in the system here. We have to seek other ways to invest our dollars."

The Central Bank of the Bahamas, in its 2011 annual report, said NIB's use of its annual $25 million overseas investment allocation stood in contrast to the Bahamian Depository Receipt (BDR) programme available to local broker/dealers for their investment funds, with only just over 50 per cent being taken up, noting that only two BISX Broker Dealers participated in the non-sponsored Bahamian Depository Receipt (BDR) programme.