Company Overview

DFL Caribbean Holdings Ltd is the new parent company of the subsidiaries of the DFL Caribbean Group.

Our subsidiaries are focused on specialized enterprise development activities in the Caribbean. This specialized focus allows the Board and Management of each subsidiary to concentrate on its core activity and to build its own relationships with regional and international partners and capital markets. The new structure, in keeping with expected improvements in banking law, provides a sharper focus for risk management and governance. It also opens up the Group to a wider array of management, technical resources and partnerships for the development of Micro, Small and Medium-Sized Enterprises.

It is well known in the Caribbean that the supply of local capital exceeds demand. This has created high levels of liquidity. That liquidity, despite the low cost of deposits, cannot be fully invested in business activities because of the slow rate of creation and development of new enterprises. In fact, Caribbean SME are in decline because of inadequate responses to globalization of markets caused by the impact of inflation and low productivity on competitiveness. The region's slowness in developing managerial and technical skills suited to local markets and conditions has restricted SME. Infrastructural stresses in communications, transport and utilities have disproportionately increased costs for SME and have reduced their efficiency. This business environment is difficult. The DFL Group must respond because its only Mission is the growth and development of Micro, Small and Medium-Sized Enterprises in the Caribbean. Our response involves a New Beginning for the Group in collaboration with its institutional shareholders. It is founded on three platforms:

  1. Implementation of our Regional Expansion Plan approved by the shareholders in 2005. This includes the establishment of DFLSA Inc in Guyana and Suriname and the wider use of the Group's technical capabilities to serve larger projects and share risk through multi-bank financing by way of loan participations and securitizations
  2. The development of partnerships for technical assistance through managed entities such as the EEVF Caribbean Trust and its associates, Caribbean SME Development Network Ltd and Caribbean Business Services Ltd
  3. Working with new ideas in transforming enterprises involved in manufacturing, agro-industry and tourism and in strengthening cross-border business activity in services (including private education) through CDN Management Services Ltd

The main subsidiaries of the Group are Development Finance Ltd (DFL) which has an international credit rating of BB and Caribbean Development Capital Ltd (DEVCAP) which began private equity investing two years ago taking over from DFL which successfully managed this operation since 1988. DEVCAP will soon launch a new regional Private Equity Fund covering the Caribbean.

Microfin Caribbean Holdings Ltd (MICROFIN) operates microfinance subsidiaries in four countries. Microfin was a pioneer in establishing microfinance in small economies. The challenges are daunting. The Caribbean is made up of small, dispersed markets. Microfinance in the Caribbean cannot be as profitable as in Latin America and Asia. We cannot expect that Microfin will make a significant contribution to the Group’s overall profitability. However, Microfin must achieve a reasonable return on capital to develop its ability to raise funding on local and regional markets. To ensure success in 2007, Microfin will implement innovative technology applications it has developed for the Caribbean. It must also recruit dedicated and talented management and staff for its expansion.

 

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