Sagicor Financial Company Ltd. (SFC) Earnings Call Transcript & Summary

My name is Stephen McNamara, and I'm the Director and Deputy Chairman of the Board of Sagicor Financial Company Limited. It gives me great pleasure to welcome you to the company's 2022 Annual Meeting of Shareholders. As you know, we are using a hybrid format, and the meeting is, therefore, being conducted in person and via live webcast. I now invite the Corporate Secretary, Althea Hazzard to present the agenda, procedures and guidelines for today's meeting, having regard to the nature of the meeting and the COVID-19 protocols, which persons attending the physical meeting must observe.

Good morning. Please place your phones on silent mode if you have not already done so. Our agenda for this Annual Meeting of Shareholders will begin with the meeting Chairman calling the meeting to order and address various preliminary matters. You will then hear a statement from Mr. Mahmood Khimji, Chairman of the Board, who is unavoidably absent. This will be followed by a review of the financial results by our group COO, CFO, Andre Mousseau. The items of business we voted on will then be moved, each be followed by formal discussion, if any, of the applicable item. Voting will then close, and there will be a general shareholder question-and-answer session. Following the question-and-answer session, the Chair will report the voting results. Registered shareholders and properly attending proxyholders of record attending the meeting virtually are now able to submit comments or questions to formal discussions or for the general question-and-answer session via the messaging platform on your screen. And the electronic ballot for voting is also now available for those attending virtually. You are encouraged to submit any comments or questions in advance of the question-and-answer session. Voting for virtual meeting. If you are a registered shareholder attending virtually, who has not provided voting instructions, and you wish to vote your shares, you may do those so at any time during the formal business of the meeting using the electronic ballot on your screen. Properly attending proxyholders may also vote at any time using the same method. The polls remain open until just before the conclusion of the formal business of the meeting. If you voted your shares at the start of the meeting, your vote has been received by the company's scrutineers, and there is no need to vote those shares during the meeting unless you wish to revoke or change your vote. If you are physically present here with us at the Hilton Barbados Resort as a registered shareholder or properly attending proxyholder. You would have received a ballot on entering the meeting. The Chairman will invite you to vote on the individual items at the appropriate time, but you may use this ballot any time while the polls remain open. The polls will close just before the conclusion of the formal business of the meeting. Please remain seated and your ballot will be collected from you. If you've voted your shares prior to the start of the meeting, your vote has been received by the company's scrutineers, and there is no need to vote those shares during the meeting unless you wish to revoke or change to your vote. For the benefit of all shareholders, shortly following the meeting, we will post the final voting results on the Investor Relations page of our website. The results will also be filed on SEDAR. Questions. If you are a shareholder or properly attending proxy holder, participating in the meeting virtually, you may ask questions at any time during the meeting via the messaging platform on your screen. During the formal business portion of the meeting we will respond to the appropriate questions received on the applicable items of business. If you are a shareholder, a properly attending proxyholder and you are physically present with us here today, you'll be invited to ask questions on the respective items of business at the appropriate time. COVID-19 protocols in effect, require attendees to maintain a physical distance of 3 feet and to wear your mask while indoors. We will also observe the necessary sanitization requirements. Appropriate questions that are not related to items of business will be addressed in the question-and-answer session near the end of the meeting. This is subject to time constraints of 2 questions per person and 2 minutes per question. If it is not sufficient time to address any appropriate questions at the meeting, we will post them and the company's responses on our website shortly following the meeting. During the formal discussion and question-and-answer portion of the meeting, comments or questions, including the legal name of the submitting shareholder or properly attending proxyholder may be read aloud before being addressed. Before asking a question on the floor, for those of you here in person, please state your name and the name of the shareholder you represent if you are a proxy or corporate representative. Comments or questions may not be addressed, which are irrelevant to the business of the company or the business of the annual meeting. Related to material nonpublic information of the company, related to personal grievances, derogatory references to individuals that are otherwise in bad taste, repetitive statements already made by another shareholder or out of order are not otherwise suitable for the conduct of the annual meeting as determined by the Chair of Corporate Secretary in a reasonable judgment. If we encounter any technical difficulties with the webcast during the course of the meeting, those of you online, please remain logged on, and we will have the matter addressed as soon as practicable. Finally, I would like to remind everyone that there may be forward-looking statements made and non-IFRS measures discussed during today's meeting. These forward-looking statements are, unless otherwise noted, given as of today's date and involve risks and uncertainties discussed in our filings with our securities regulators. A number of factors and assumptions were applied in the formulation of such statements, and actual results could differ materially. Non-IFRS measures are discussed in our management discussion and analysis for the year ended December 31, 2021, and/or for the 3 months ended March 31, 2022. For additional information with respect to forward-looking statements factors and assumptions and non-IFRS measures we direct you to Sagicor's public filings. I now turn back to the Chairman of the meeting, Mr. McNamara.

Thank you, Althea for outlining today's agenda, procedures and guidelines. We wish to acknowledge the retirement of Mr. Timothy Hodgson as Chairman of the Board of Directors on December 31, 2021. Tim was instrumental in guiding and supporting Sagicor through its transition to a listing on the Toronto Stock Exchange. His leadership at the Sagicor Group at such a crucial time is appreciated. The meeting will now come to order. I would like to introduce the members of the Board of Directors of the company and executives who are with us today. At the physical meeting from far left Mr. Peter Clarke, Director; Mr. Andre Mousseau, Group Chief Operating Officer and Chief Financial Officer; Mr. Dodridge Miller, Director and Group President and CEO. On my immediate right, Althea Hazzard, Corporate Secretary; Professor Sir Hilary Beckles, Director and Dr. Archibald Campbell, Director. My fellow directors who are also joining us virtually today are Keith Duncan, Monish Dutt, Jonathan Finkelstein, Dennis Harris, and Reza Satchu. We have apologies for the absence of Mr. Mahmood Khimji, Stephen Facey, Gilbert Palter and Ms. Aviva Shneider. As noted by Althea, will begin with remarks from the Chairman of the Board, Mahmood Khimji, followed by a presentation by our group COO and CFO, Andre Mousseau. Following this, we will turn to the formal business of the meeting after which there will be time for general shareholder questions. Althea Hazzard, the Corporate Secretary of the company will serve as secretary and record the proceedings of the meeting. Christopher de Lima, Rebecca Prentice and Mackenzie Tuff from the TSX Trust Company will act as scrutineers. Voting at today's meeting will be by ballot as this best facilitates a hybrid meeting format. While voting on a show of hands in the hybrid context has not been specifically tested in Bermuda. We are mindful that in terms of the precedent and the other Commonwealth jurisdictions voting by way of a show of hands in a virtual AGM and is not well received. We will now proceed with the meeting. This year, Sagicor used notice and access to deliver its annual financial statements and meeting materials. And as a result, the notice of the meeting and the management information circular are accessible on Sagicor's website and under Sagicor's profile on SEDAR. They are also available in the documents tab on the left-hand side of your screen, if you are attending virtually. The form of document proxy and the form of proxy for voting instruction form were mailed to all shareholders of record as of the close of business on April 28, 2022. We have received an affidavit from the TSX Trust Company as to the proper sending of the notice of this meeting and the form of proxy to shareholders. I have been informed by the scrutineers that we have a sufficient number of shareholders present or represented by proxy that hold a sufficient number of shares to constitute a quorum. As a quorum is present and proper notice of the meeting has been given, this meeting is now duly and properly constituted for the transaction of business which may properly come before the meeting. I direct that the scrutineers report be incorporated into the minutes of this meeting. We will now share with you all the message from Chairman of the Board, Mahmood Khimji.

Good morning, shareholders, and thank you for joining today's Annual General Meeting. First let me talk [indiscernible]. Our Vice Chairman, Stephen McNamara will chair today's proceedings. Sagicor is a well-established company with a distinguished heritage, deep roots within its communities and a commitment to delivering value to its stakeholders. It is my distinct honor to be Chairman from January 1, 2022, and I look forward to engaging with all of you at future meetings. Thank you.

I will now turn to Andre Mousseau, Group Chief Operating Officer and CFO, who will provide a review of the financial results.

I'm told I can take that off. Good morning, everyone, and behalf of the Sagicor' executive team and all our employees to our shareholders here today, let me say it is very good to see you in person. After Years now of shareholder and Board meetings being done virtually, it is a pleasure to reconnect face-to-face and some instances not for the first time. So it's really wonderful. The last time we were all together was in 2019. And these past 2.5 years have been extraordinary and through it, our team and our company has proven its resilience is well positioned for continued stability and growth into the future. I'm going to provide a brief summary of the financials, and I believe that there will be some Q&A later on in the agenda to the extent shareholders have questions. So first, I will speak of 2021. After 2020, a year in which we dealt with unprecedented adversary -- adversity navigated market volatility, and learned how to work remotely, Sagicor returned to profitable growth in 2021. And that's measured by revenue, by assets, by net income. Sagicor had the strongest results in its 180 years' history. We made strides throughout our operations. We grew our revenue 26% to USD 2.4 billion. We grew our assets by over $1 billion and we delivered $133 million of net income to our shareholders. We built on that strength to refinance our global bonds at much improved rates, a move which in today's environment seems -- certainly seems precedent. We're in grass forward with multiple strategic initiatives to transform the way we do business with our customers. And throughout it, we upheld our commitment to being model citizens in the jurisdictions in which we operate, continuing our support of community initiatives signal providing access to vaccinations for those of our employees and their families who needed access and helping out our friends in need throughout the Caribbean. So far in 2022, we're pleased to say that we have continued with that strength. In the first quarter, our revenue was up over 50% from the prior year as we continue to grow our business through our throughout -- throughout our organization and including in the United States, where our tightened focus continues to drive strong results. Net income shareholders was also up 33% year-over-year at $42 million. And we confirmed our major initiatives that have become a poorly kept secret that we're about to launch an all-digital bank here in Barbados. This is a major investment in Barbados for Sagicor and 1 that we believe will revolutionize the banking experience for Sagicor's policyholders and new customers alike. In the meantime, we're hard at work at our core operations, implementing new technologies throughout our businesses, responding to changing regulatory and accounting landscapes and continuing to perfect doing business in a hybrid work environment. We continue to work to engage the global equity markets to attract broader support for Sagicor shares and more properly reflect the value of our organization. Now this morning, it was a beautiful day here in Barbados, but today's global economy feels more like the weather from earlier in the week, storming. Collectively, as a global economy, we have deferred much of the pain of the pandemic through accommodative fiscal and monetary policy, and we are all starting to feel the pain now through this factor of price inflation, rising interest rates and financial asset devaluation. And in addition to that, the effects of war in Europe are being felt here as well as that conflict pushes food and energy prices ever higher. In times like this, we can all be proud of Sagicor whose resilience has been proven time and time again through challenges, both local and global. And our strength and continued robust performance will allow us to prevail through today's storms to live up to our promises to our policyholders our shareholders and to our communities in the decades to come.

Thank you, Andre. The next matter on the agenda is for the shareholders to receive the company's audited consolidated financial statements for the year ended December 31, 2021 together with the auditor's report thereon. Both of which can be found in our annual report. The 2021 annual report is available to all shareholders through the Investor Relations page of our website and on SEDAR. The annual report is also available in the documents tab on the left-hand side of your screen. Copies of the annual report were also available at the entrance to the physical meeting room. I invite shareholders or proxy holders who are physically present to ask any questions which relate to this item of business.

Now I see you have a table of very qualified persons. So I'm sure that been able to add to these simple questions that I have here for you. Now the first 1 relates to the pension plan benefits so there's a mixture of defined contributions and defined benefits. As I'm not graduating challenges or the institution on [ KFL ] I would just ask you about this defined benefit and what portion of your benefits plan is classified under defined benefits that's the first question.

Good morning. Thank you for the question. We have several plans across many institutions. Generally, our U.S. plans are defined of the first contribution plan or legacy Caribbean plans or defined benefit plans. So Sagicor Life, Sagicor Group, Jamaica, they are all mainly defined benefit plans. The U.S. plans are defined contribution plan based on the U.S. [indiscernible] model.

Okay. No, I was speaking specifically to the employee benefits. What percentage of the pension plan defined benefit. Page 37 of the Financial Company Limited document, which is a smaller document.

So, what exactly you're asking [indiscernible].

Okay. Okay. There it says that it's -- it's either defined contribution or defined benefit. So my question was what is what percentage is defined benefit.

80% of the company is based in the Caribbean, largely defined benefit plans. 20% of the U.S. in terms of employee benefits is defined contribution.

Can I just say quarter-on-quarter the plan is either a defined benefit plan or a defined contribution plan is not 1 plan that has a percentage of defined benefit and a percentage of defined contribution. And days gone by plans were defined contribution plans, correct me if I'm wrong -- benefit plans in the past, and there's a move towards now them changing to become defined contribution plans.

So the plan that you might be a part of will be a defined benefit plan or contribution plan. I don't think which as a percentage of 1 and a percentage of the other.

Okay. Let me ask the question another way. So there's no misunderstanding. So defined contribution from my limited knowledge stipulates how much money an employee puts into that plan. Defined benefit my limited knowledge stipulates how much money the employer will pay the beneficiary upon retirement. In defined benefit plan therefore would result in a higher potential liability pension shortfall on a defined contribution. So my question was the exposure or the percentage exposure of Sagicor to defined benefit plans to its employees.

So you want to know the defined benefit obligation that's on the balance sheet as at the end of the year. Is that what you're referring to?

You could play that.

We'll find that number for you and give it to you certainly.

Now moving on, and again, this is just tough that here on the [indiscernible] morning. So interest rates have gone up in the U.S. and Sagicor is doing very well in the U.S. So the Sagicor have any debt obligations in the U.S. and as so how much?

Thank you for the question. We have bonds that I referenced that we issued last year which will come due in 2028. The amount of those bonds is USD 550 million. Those are fixed interest rate bonds with a coupon fixed at, 5.3%. So those would remain the payments on that debt would be unaffected by the current interest rate environment.

Okay. Thank you for that. So Sagicor -- okay. So put this way. So this debt of USD 500-plus million. Is this debt to Sagicor, the entire corporation, the entity? Or is this debt obligation of Sagicor subsidiary in the U.S.?

That debt is an obligation of the parent company, the Company, of which you would be a shareholder of.

Okay. Thank you. Now with the interest rate increases this week from the -- in the U.S., it's supposed to be another 2 minimum interest rate increases. So what's the exposure of Sagicor to a possible recession in the U.S.

Well, the exposure can be measured and that decreased economic activity affects how much money that our policyholders and potential policyholders have in their pockets to spend and to save through life insurance. Through interest rates, -- the other way that recession would affect our business would be to the extent that the assets that we hold take -- have credit events where we would not be paid back on the bonds that on the bonds in which and other loans in which we've invested. I would say that our record through multiple investing cycles of credit have been very good. And for example, the last time that the -- that there were significant shifts in the investment environment. About 2 years ago, we took very small loss ratios, less than 1% of the portfolio in our U.S. business, which is directly exposed to U.S. bonds. So we invest prudently.

Sir, can I just remind you of our 2-minute 2 question rule. We're under some time constraints because of the times that we're in and the protocols that apply, and I'm afraid we are constrained to pass these on to the shareholders. Hence, that 2-minute 2-question rule. That's very kind of you to take it so lightly. Any other questions from the room?

Davin Chase for the record. Good morning to all. On page 126 of the Sagicor Financial Company Limited report. I see the figures are in thousands of U.S. dollars. Even the section there retained earnings. You have roughly in 2021, at least low is $400 is something million close to USD 0.5 million on the books and retained earnings. A question they put to you a shareholder or their plans and work for paying a special dividend to the shareholders. And like that you've had some windfall in the pandemic recently an increase in revenues. So -- will you be so gracious as to endeavor to share the [ flatten cap ]

The management and the board continues to review our dividend policy every quarter. And to the extent that we have retained earnings that grow the equity of the business, they can either be returned to shareholders or they can be reinvested in the company and to support future growth. And we try to strike a balance between those 2. While our dividend policy remains the same in terms of the notional payment in the light of a very strong 2021, we would remind you that we continued to make payments unadjusted to shareholders in 2020 when due to the market volatility of the onset of the pandemic, we had no net income to shareholders as well at all, I should say, in 2020. And so we continue to review the policy, but the plans would not be to institute a special dividend at this time.

And not too distant future then?

I could only comment on the present.

Okay. On Page 166 of the annual report for Sagicor Financial Company Limited. And I want a clarification here. As on the top of the page, on the [ capture ] segments. And we have here on the head office and other group companies. We have Sagicor Financial Company Ltd., right? Group parent company in Bermuda 100%. And then you have Sagicor Financial Corporation Limited, a holding company, Bermuda also listed at 100%. So as a shareholder, I'm seeking clarification. Can you can reply differences kind of bit confused between the 2 companies?

If you'll recall the scheme of arrangement that was closed in December 2019, the pre-existing holding company in which you would have been a shareholder, Sagicor Financial Corporation Limited was acquired by Sagicor Financial Company and all the shareholders who had not opted to take cash, were had their shares exchanged in Sagicor Corporation Limited for shares of the new parent company which, like the old 1 is a Bermuda-domiciled company. So as a shareholder, you own shares of Sagicor Financial Company, Sagicor Financial Company in turn is the sole 100% shareholder of the old company, Sagicor Financial Corporation Limited.

Okay. And my last question. So on Page 224, once again, I'm seeking clarification as a shareholder. It relates to the investment in Playa Hotels & Resorts, which I understand is the hotel. And I want to know if it's ways of financial thinking for life. You have seen investment at the current page 225, you don't have 7% shareholding in Playa Hotels investments. So can you clarify for me as a shareholder? If this is why it's finance and thinking for life to be investing in the hotels Playa Resorts or however.

Sure. Certainly, it's a good question, and we do believe that our ownership in Playa Hotels & Resorts reflects wise financial thinking. The legacy of the shareholding was that our subsidiary in Jamaica had developed a number -- and owned a number of hotels and decided to exchange that shareholding for share -- or exchange the ownership in those hotels for a shareholding in a larger, a larger group of hotels called Playa, which itself is a publicly traded company. Our Jamaican subsidiary at the start of last year through its investment companies had made a decision to divest of those hotels at Sagicor Financial. We made what in retrospect has turned out to be a wise decision. To acquire a portion of those at $4.80. Notwithstanding the recent market volatility, the shares of Playa today trade at a significant premium to the level at which we acquired them. And we believe that through the insights that we have through our management team and our Board of Directors as well as seat at their governance table through having an appointee on that public company's Board of Directors that we have a good view on value and that this will continue to be a strong investment for us.

Madam Secretary, have we received any online questions relating to this item of business?

No Chair, no such questions.

In accordance with the Bermuda Companies Act and the company's bylaws, the statements are presented to the meeting, but no other action is required with respect to them. The second item of business is the election of the directors of the company. The management information circular for the meeting lists 14 director nominees. The nominees identified in the management information circular for election as directors are Dodridge Miller; Sir Hilary Beckles, Dr. Archibald Campbell; Peter Clark, Keith Duncan, Monish Dutt, Stephen Facey, Mahmood Khimji, Reza Satchu, Aviva Shneider, Gilbert Palter, Jonathan Finkelstein, Dennis Harris, and myself, Stephen McNamara. I will now ask a shareholder to move to formally nominate as a director each of the proposed director nominees named in the management information circular for this meeting, for election as a Director of Sagicor Financial Company Limited to serve until the next annual meeting of the shareholders or until their respective successor is elected or appointed. Thank you.

Will someone second the motion? Thank you. As no notice of additional Director nominees was received in accordance with the company's bylaws, I declare nominations closed. I now ask a shareholder to move to elect each of the 14 named individuals as Directors of the company. Will someone second this motion? Thank you. I invite shareholders or proxy holders who are physically present to ask any questions which relate to this item of business.

Thank you, Chair for keeping in line earlier. I wasn't aware the 2-minute time limit. Well, first of all, it says there that PricewaterhouseCoopers, PwC is up for renomination. My first question would be how long has PwC.

Shareholder can -- can I ask you to hold that question until we come to the item of the reelection of PwC. It's the next item. And I will keep in mind that you wanted to address that issue. Madam Secretary, have we received any online questions relating to this item of business?

No. Mr. Chairman, we have not.

Persons voting at the physical meeting are invited to use the ballot received to cast their votes on this item of business. As a reminder to shareholders and proxy holders voting online at the meeting, to vote on this item of business, use the electronic ballot on the left-hand side of your screen and under item #1. You will find listed the names of the 14 nominees for election to the Board of Directors listed in the management information circular. For each nominee, you may vote for or withhold voting. As previously noted, the results of the voting will be shared later in the meeting. Is there anyone who wants to vote in the room who does not have a ballot. Okay. The next item of business is the appointment of the company's external auditor for the next year and authorizing the Board of Directors to fix their remuneration. I ask a shareholder to move that PricewaterhouseCoopers SRL be appointed as the company's external auditors until the next Annual Meeting of Shareholders or until a successor is appointed and that the Board of Directors be authorized to fix the auditor's remuneration. Thank you. Will someone second this motion? Thank you. I now invite shareholders or proxy holders who are physically present to ask any questions which relate to this item of business.

Yes. Right, right. So my question -- first question was how long has how many years as PwC been the external auditor for Sagicor?

It has been some time, Jerry, our auditor. Jerry, would you know the answer to that?

We have been auditors since the mutualization, which I think was in 2002, and there was a full reproposal process done, I think, in 2013.

So as management and the Board, we continually assess our options on an annual basis. And we, as a representative from PwC referred to, we put it out to tender on a formal basis from time to time. The last time that was done PwC was deemed the best qualified and to deliver the best value to the Board and to its shareholders.

Thank you. On to my second question, the why I act there because I know this process of external auditing, it's supposed to be arm's length and external. So if you've been leasing with someone for 20 years. It's hard to imagine that, that relationship is arm's length. It's a very long time. And for transparency and partiality purposes, it would be good to have additional options. Now I am not aware of the process that the Sagicor Board goes through the requirements or the requirements that the Board has to deem an external auditor, value for money appropriate, et cetera. But would it not be better to have at least 2 options for the shareholders to vote on the top 2, I would say, as you are here asking the shareholders to reappoint it should be the same how this 14% here for the Board, it should be, would you like to go with this firm, that firm and maybe a little bit about their bid, does have to be everything, but a little bit about their bid. So going forward, I mean, is that something that the Board would be interested in doing because to come here, the only options you have is, yes, you approve the auditors or you don't. So what happens if you don't reapprove the auditors, right? So -- and I think 20 years, you can't say that, that is an impartial relationship because people have the fixed bonds, right? And this is just a simple process. Are you going to pass the financial auditor statement, the financial statement? Is it going to be a qualified opinion or unqualified opinion. So I just for your response.

Maybe 20 years is not the same people that have been auditing the company, the partners actually rotate every so often. So again, for the independence and transparency. But you have to take into consideration, in fact, we operate in 23 different jurisdictions, and we need to find an audit company that can span 23 different jurisdictions. Because you can have 1 to the auditors 1 place and another side the other places, it becomes very inefficient process. Within the external auditors on independent structure, there are lots of things that they do to ensure that the relationships that you described wouldn't work to be this advantage to the shareholders and within the company, there are also lots of mechanisms that we have in place. We have an independent audit committee that's chaired by independent director. He has direct contact with the auditors without management intervention. So there are lots of things in place to ensure that the independence and the transparency that you're requesting is done. But we need to find a set of auditors who have the capacity we followed this company across many, many jurisdictions. I don't know if that helps.

I don't know if I could put in 1 more question here, and I have to ask the Chair.

Yes, go ahead.

Right. Okay. No, what -- okay, so what you're saying about D&O -- let me put it this way. The best way to determine whether or not there is financial [indiscernible] such as earnings management if you do a forensic audit and you look at almost everything. External auditing process here just get an example or percentage of the statement. If you as a Board tells PwC, no item is deemed to be of materiality -- or material for financial purposes, that it's over USD 0.5 million or USD 1 million, anything below that is not deemed an issue. So from my perspective because I have done both internal and external audits. As long as you have qualified, competent people, it should not be an issue to do because you're just sampling these statements. And I know from dealing with auditors, you have an auditor for too long regardless of -- because you're not going to change all of the partners at once. A partner comes in, a partner comes out. And I'm not sure if PwC would sign, for example, a conflict of interest declaration. What happens if there's an issue, challenge, right? So it would be very easy. You do have other firms. I don't want to call a name, but you do have other firms that have branches around the region. And if it's a situation where we would need to have an operator go to a different location they can go by both our plan because, for example, in the U.S. or Canada, some 1 is based in New York, the flight to Texas, the flight of Florida. In Canada, you're based in Toronto, you flight a Whitehorse, you flight of Vancouver. So again, it's -- distance is not an issue here. So again, what would be the issue in having at least 2 audit firm being presented to the shareholders for appointment to determine their I don't even know if the auditor remunerations in these because I haven't.

You're in line, okay, on the question because I indicated you could ask another question, but you're definitely taxing the time limit of the 2 minutes. I think you need to try and wind it up if you would.

No, I'll just wait for the response.

I would say, first of all, the company does not determine the materiality level the auditors determine what is material for them is they're independent, and they have to give their own independent opinion. The issue in the jurisdiction is not distance, the complexity is, rules and regulations and laws that exist in different territories. And it is not a question just traveling there to audit something. It's a lot more complex than that. But I appreciate your concern. Trust me in the Board pays great attention to this as well.

Madam Secretary, have you received any online questions relating to this item of business?

No online questions, Chair.

Persons voting at the physical meeting are invited to use the ballot received on arrival to cast their votes on this item of business. To vote online on this item of business, use the electronic ballot on the right-hand side of your screen and under item #2. You may vote for or against in respect of the motion. That is the final formal item of business. As such, discussion of the items of business is now closed and online voting will close in 15 seconds. Please ensure that you register your vote now if you wish to do so and have not already done so. We invite the polling assistance to collect the ballots from those physically in attendance. [Voting]

The polls are now closed with respect to voting on all the motions. Even as the ballots are being collected from persons who are in the room. Voting results are being tabulated by the scrutineers and will be provided later in the meeting or shortly thereafter. The report on the voting results will be incorporated into the minutes of the meeting. The final voting results will be posted on the Investor Relations page on Sagicor's website and filed on SEDAR. I'm advised by the Secretary that there are no other matters of business to properly come before the meeting. At this time, we would like to open the floor to any other questions that shareholders or properly attending proxy holders may have relating to the company. In that regard, I will ask the Corporate Secretary to review the online procedure for our shareholder question period. Althea?

Thank you, Chairman.

If shareholders are properly attending proxy holders wish to ask a question or make a comment, please enter your questions in the messaging platform on your screen for those online. I will read the questions that are submitted and consolidate questions of the same nature. If we do not have time to respond to appropriate questions in today's session, we will post a list of those questions on the Sagicor's website as well as Sagicor's response. I remind all shareholders of the guidelines for questions that were provided in the preliminary remarks at the start of this meeting, and of the time constraints of 2 questions per person and 2 minutes per question.

Can I speak Mr. Chairman?

Yes, yes. proceed.

Once again, I see [indiscernible] proxy shareholder. As the -- reference will be made earlier in the meeting about Sagicor [ commenting ] a new digital bank. I'm just trying to find out as a shareholder, whether the [ relative ] due diligence was done and risk management for unforeseen circumstances and circumstances beyond their control. Was a sandbox method [indiscernible] so you can have a drill before you actually startup of the setback. So seeking clarification on this new digital bank, which you alluded to earlier the evening that you can kindly clarified for, sir.

Thank you for the question. I think from a due diligence point of view, so to speak, we have the advantage starting from scratch. And therefore, we have the opportunity to design our all of our risk systems and procedures and technologies on the basis of the expertise of the team that we have assembled. And rest assured, we will be testing it internally and with our employees within the bank before it would be out to a public launch.

Good morning, Mr. Chairman. My name [indiscernible] is for the record. I think -- it is really -- I mean the year is 2022. And we've just -- we've been asked we elect the Board that has 13 male members and 1 female member. I don't think that this reflects current practice and diversity. And I would ask that the board in the coming years seek to address this matter.

I can assure you, Mr. [indiscernible] that, that will be the case as is indicated in the Management Information Circular under the heading of diversity. The matter is 1 which is constantly on the table and so far as the Board is concerned. The disproportionality that you mentioned is something that we're well aware of. And at the first appropriate opportunity, that matter will be addressed. We can assure you. Thank you for reminding us of it. Madam secretary, have you received any appropriate online questions. Oh, just a second. Sir, go ahead.

First question would be that Sagicor or any property, land or buildings on the West Coast St. James Theatre, that is an contention -- legal contention or dispute.

I don't think so, something has come to our attention. Would you like to draw something to your attention?

No, no, I would...

Up now that is where there's a lot of irregularities occurring on the island, right? And a lot of companies are willingly or unwillingly involved in that. So I just wanted to make sure that the good gentleman and lady on the big duster we're -- we're not in such a situation. One comment now to what Mr. Miller had said earlier about 1 auditor for the entire region, from my limited understanding, if a company is using IFRS, which is the global standard, 1 auditor should be able to do the audit for all of the subsidiaries. But that's just a comment. My second question would be does Sagicor have an internship or an apprenticeship program. I see we have a representative here from the educational institution. So the Sagicor have an apprenticeship or an internship program for young people, students in the region that would develop them and give them experience in the workplace. And if Sagicor does not have such a program, why not?

We do have such a program. We have several interns working with us minute right across many jurisdictions. So yes, that program is already in place. And to your earlier question, the answer on the pension obligation is on Page 211. So you'll see it all there.

Mr. Chairman, no question, there's a comment from Eden Davis, maybe consideration should be given to a policy of changing of what in to change the audit firm every x number of years. And that's the only comment online.

Okay. As I think we have answered all of the provided appropriate questions. It is now time to conclude the question-and-answer period. The scrutineers have reported to me regarding the matters voted on today, and I will now announce the results. With respect to the resolution regarding election of each of the individuals nominated as directors, I declare that each of the 14 nominees is elected as a Director of the Company. With respect to the resolution to appoint PricewaterhouseCoopers SRL as the auditor of the company for the ensuing year and to authorize the directors to fix their remuneration. I declare this resolution duly carried. Ladies and gentlemen, this completes the business of the meeting. On behalf of the entire Board of Directors and management team of Sagicor Financial Company Limited, we thank you for your ownership interest and your attendance at our Annual Shareholders Meeting today. Those of you who have joined us physically are now invited to share a light refreshments outside. Again, I thank you, and you a good rest of the day. Thank you very much.