• Sygnus Credit Investments Limited (SCI) has advised on the Basis of Allotment of its JMD and USD Preference Shares Offers. The Invitation closed on Friday, December 15, 2023, at 4:30 p.m. and was oversubscribed in all classes. The company received approval to upsize all classes of the shares.
• Class C shares were oversubscribed by 109.00%, totalling 16,727,200 shares, and was upsized to 16,000,000. All applicants of Class C Preference Shares will be allotted the first 250,000 shares applied for and 71.13% of amounts in excess of the 250,000 shares.
• Similarly, Class D shares were oversubscribed by 68.00% or 678,080 shares and was upsized to 1,678,080. All applicants of Class D Preference Shares will be allotted 100% of the amount applied for.
• Class E shares were oversubscribed by 136.00% (or 1,355,760 shares), totalling 2,355,760, and was upsized to 2,321,920. All applicants of Class E Preference Shares will be allotted the first 25,000 shares applied for and 66.61% of amounts in excess of the 25,000 shares.
• Overall, the dollar value of shares allotted amounted to J$1.6Bn and US$40.0Mn. Refunds to applicants should be made available to the account stipulated in their application by January 5, 2024.
• It is anticipated that the Preference Shares will be listed and begin trading on the Jamaica Stock Exchange (JSE) by January 24, 2024.

(Source: JSE)

• Britain will deploy a naval ship off Guyana later this month, its Ministry of Defence said, as the South American nation faces a border dispute with neighbour Venezuela over the oil-rich Essequibo region.
• "HMS Trent will visit regional ally and Commonwealth partner Guyana later this month as part of a series of engagements in the region during her Atlantic Patrol Task deployment," a spokesperson said.
• The deployment follows a visit by a British junior foreign minister to Guyana earlier this month, intended to offer the UK's support for the country, an ally and former British colony.
• Guyana and Venezuela agreed earlier this month to avoid any use of force and not to escalate. Venezuelan Defense Minister Vladimir Padrino said in a social media post on Sunday that his country would remain "on alert following provocations that put at risk the peace and stability of the Caribbean and our America."
• The 160,000-square-km (62,000-square-mile) Essequibo region is generally recognised as part of Guyana, but in recent years Venezuela has revived its claim to the territory and its offshore areas after major oil and gas discoveries.

 (Source: Reuters)

• The Association of Multiple Banks of the Dominican Republic (ABA) has highlighted the pivotal role of the banking sector in reducing the housing deficit and enhancing access to decent housing. This progress, driven by Law 189-11 for Mortgage and Trust Market Development, is evident in the significant increase in housing-related financing over the last decade. 
• From October 2013 to October 2023, the number of loans for home acquisition and renovation soared from 34,711 to 85,592, marking a 147% increase, or about 5,088 financings per year. In terms of the mortgage portfolio, there was impressive growth from RD$66,219Mn to RD$221,889Mn in the same period, a 235% rise. This sector's average annual growth rate of 12.9% outpaced the overall loan growth rate, with an average disbursement of approximately RD$15,567Mn annually for home purchases and renovations.
• The ABA noted improvements in financing conditions, with interest rates decreasing by 196 basis points from 12.4% to 10.5% between October 2013 and October 2023 and longer credit terms becoming increasingly available.
• These developments have positioned the banking sector as a crucial facilitator for Dominican families in acquiring and improving their homes, thereby contributing to a reduction in the housing deficit. The sector has effectively transmitted monetary policy aimed at housing solutions, leading to more loans, higher disbursement amounts, and better credit terms.
• The ABA reaffirmed its commitment to working with various entities to further reduce this deficit. Initiatives like the Happy Housing program, a public-private initiative that the banking sector support, aims to provide more accessible low-cost housing for lower-income families in the Dominican Republic. This ongoing collaboration and focus on favorable mortgage conditions continue to support an increasing number of Dominican families in achieving or improving their homeownership.

(Source: Dominican Today)

• The oil and gas industry underwent a significant $250Bn buying spree in 2023, marked by major acquisitions from Exxon Mobil, Chevron Corp, Occidental Petroleum, and ConocoPhillips. The focus was on securing lower-cost reserves, with the Permian Basin emerging as a key target, positioning these companies to control around 58% of future production in the region.
• The acquiring companies aim to collectively pump at least 1 million barrels per day from the Permian Basin, which is expected to produce 7 million barrels per day by the end of 2027. A surge in oil demand, driven by the recovery from the pandemic downturn, has fueled optimism among acquirers.
• The consolidation trend is expected to have spillover effects on oilfield service companies and pipeline operators. With fewer customers holding more pricing power, service companies may face squeezed margins as contracts are renegotiated.
• Pipeline operators are experiencing their consolidation wave, with fewer new oil and gas pipes being approved and built. However, expansions to existing lines out of the Permian Basin will provide some relief.
• Acquisitions in 2023 were largely facilitated by strong stock prices, reducing the need for significant cash outlays. Rising interest rates made stock swaps more attractive than funding new renewable energy projects.
• However, the consolidation has prompted regulatory scrutiny, with U.S. antitrust regulators seeking additional information from Exxon and Chevron. The companies express confidence in approval but acknowledge the potential tension with governments prioritizing a shift to clean energy sources.

(Source: Reuters)

• U.S. retail sales increased by 3.1% between Nov. 1 and Dec. 24, slightly below Mastercard's earlier forecast and significantly lower than the previous year's growth, with factors like higher interest rates and inflation impacting consumer spending.
• Amazon and Walmart intensified promotions in November, with discounts perceived to be less profound than last year. Shoppers, remaining price-conscious, delayed purchases until Black Friday and Cyber Monday, culminating in a final surge on Super Saturday.
• E-commerce sales grew at a slower pace (6.3%) compared to the prior year (10.6%), indicating a moderation in online shopping after the pandemic highs.
• Apparel and restaurant sales increased (2.4% and 7.8%, respectively), while electronics sales saw a slight decline (0.4%) during the holiday shopping period.

(Source: Reuters)

• The Jamaica Stock Exchange (JSE), in paving the way for more cross-border listings locally, has signed its latest memorandum of understanding (MOU) with the Nairobi Securities Exchange (NSE) in Kenya in a move to forge stronger ties with Africa.
• In welcoming the historic partnership, the managing director of the JSE, Marlene Street Forrest, said it unlocks an enormous opportunity for the cross-listing of stocks and other investments by locals in the African country and vice versa.
• The JSE, now partnering with a growing list of countries across Africa, signed an MOU with Ghana last year and remains in dialogue with other states, such as Sierra Leon, as it works to strengthen African-Caribbean relations. Banking on the tenets of commonality, a shared past, and common objectives, markets across both regions believe they can work together for the common good.
• Ugas Mohamed, chair of the Capital Markets Authority in Kenya, mentioned that the key areas targeted for collaboration under the recent MOU were capacity building through knowledge transfer, joint training programmes, and possible cross-listings.
• The JSE aims to build out its green bond portfolio in 2024 and expressed an interest in learning from the NSE’s experience in this area. Importantly, this collaboration will unlock new opportunities for Jamaica, enhance market liquidity, and provide investors with diversified and innovative product offerings.

(Source: JSE)

• For December 2023, the Bank of Jamaica (BOJ) projects that the value of currency issued by the Bank will increase by approximately $29.7Bn (or 11.7%) relative to the currency stock at the end of November 2023 ($253.7Bn). Currency stock refers to all Jamaican notes and coins held outside the Bank of Jamaica.
• The projected currency stock of $283.4Bn at the end of December 2023 represents an annual growth rate of 21.2% compared to 3.0% for 2022. The projected growth is consistent with higher cash demand for the calendar year 2023 to date and reflects continued growth in both real Gross Domestic Product (GDP) and the prices of goods and services. The projected growth also reflects an increase in vault cash amid a slow return of old currency notes to the Bank of Jamaica.
• When the forecasted change in the general level of consumer prices is considered, the currency stock in real terms is projected to increase by 12.9%, which compares to the real decline of 5.8% for the previous year.
• Typically, the BOJ issues and redeems notes and coins daily in order to meet the demand for cash from individuals and businesses. There is normally a stronger demand for currency during the month of December, associated with increased spending over the holiday period. Financial institutions, therefore, request more currency from BOJ to satisfy this demand.

(Source: BOJ)

• Antigua and Barbuda’s EC$1.9Bn 2024 national Budget (Appropriation Bill 2023) has been passed by the House of Representatives without the approval and participation of the opposition members.
• Prime Minister Gaston Browne, who is also the Minister of Finance, criticised the opposition for their boycott of the budget debate, which ended on Tuesday night. The Ministry of Education, Creative Industries and Innovations has been allocated the largest proportion of the budget at $198.6 Million.
• The Prime Minister’s Ministry and the Ministry of Finance and Public Private Partnerships received $177.7Mn, while the Ministry of Health, Wellness, Social Transformation and the Environment was allocated $160.5Mn.
• Some measures included in the Budget are the implementation of a 10% excise tax on alcohol, tobacco, and cannabis products, increasing the Antigua and Barbuda Sales Tax rate from 15% to 17%, and the introduction of an environmental charge.

(Source: Caribbean Loop News)

• Suriname is set to receive US$53Mn from the International Monetary Fund (IMF) following the completion of the fourth review under the Extended Fund Facility (EFF) arrangement, totalling an estimated US$263Mn.
• The IMF executive board approved Suriname's request for an augmentation of access (US$63Mn) and an extension of the EFF arrangement until end-March 2025, bringing the total expected access under the arrangement to about US$577Mn.
• Suriname is implementing an ambitious economic reform agenda focusing on fiscal and debt sustainability, social protection, monetary and exchange rate policy upgrades, financial sector resilience, and anti-corruption measures.
• IMF Deputy Managing Director Kenji Okamura commended Suriname for its commitment to fiscal discipline and macroeconomic stabilization, noting positive trends such as a stabilising economy, eased exchange rate pressures, and a downward trend in inflation. Swift implementation of reforms, debt restructuring, and continued efforts to address vulnerabilities are needed for sustained progress.

(Source: Reuters)

• Developing countries are facing significant debt challenges, marked by a surge in sovereign Eurobond principal payments, reaching $78.4Bn in 2024, up from $43.6Bn in the current year. Further, lower-rated emerging sovereigns are set to grapple with a substantial increase in their debt bill, rising to over $65Bn for 2024 and 2025 combined, compared to just over $8.0Bn this year.
• However, investors are optimistic due to the U.S. Federal Reserve's shift from monetary tightening, which is expected to inject more cash into riskier assets, including emerging market debt. Despite potential risks such as a developed-world recession, ongoing wars, and political uncertainties, investors believe a widespread wave of emerging market defaults is unlikely.
• With improved borrowing prospects, gulf countries like Bahrain and Turkey seem well-prepared to manage their debt maturities. Concerns persist for some African sovereigns with high interest rates and low credit ratings, as evidenced by the default situations in Ghana Zambia, and the potential for Ethiopia.
• Limited sovereign bond issuance in 2023 creates opportunities for increased lending in the coming year, as global rate cuts could potentially reopen market access for many countries. However, challenges, including elevated interest rates and low credit ratings, may hinder some African sovereigns from participating in international bond markets despite improved global conditions.
• While the risk premium for emerging market hard-currency debt has narrowed, various risks, such as pending U.S. elections and ongoing global economic uncertainties, continue to pose challenges. Despite improvements, the world is still characterised by high rates and uncertainties, making the fundamentals challenging for investors.

(Source: Reuters)