insider trading policy - firstcaribbean international bank ... · insider trading policy date:...

CIBC FirstCaribbean - Public

__________________________________

Insider Trading Policy __________________________________

Approved: December 2015

Effective: December 2015

Next Review: November 2017

Version: 6.0(120915)

Insider Trading Policy

CIBC FirstCaribbean - Public

Table of Contents

1 Summary ........................................................................................................... 3

2 Intent ................................................................................................................ 3

2.1 Consequences of non-compliance .................................................................................................... 3

3 Audience/Scope ................................................................................................ 3

4 Policy Requirements ......................................................................................... 4

4.1 Obligations of CIBC FirstCaribbean Insiders ...................................................................................... 4

4.2 Establishment and Maintenance of Insider Trading List ................................................................... 4

4.3 Trading Windows ............................................................................................................................... 5

4.4 Employee Account Trading ................................................................................................................ 5

4.5 Pre-Clearing Requirement ................................................................................................................. 5

4.6 Information Barriers (“Chinese Walls”) ............................................................................................. 5

4.7 Black-Out Period ................................................................................................................................ 6

5 Monitoring/Oversight Mechanism ..................................................................... 6

6 Roles and Responsibilities ................................................................................. 7

6.1 The Chief Executive Officer (CEO) ..................................................................................................... 7

6.2 The Managing Director, Operational Risk and Governance .............................................................. 7

6.3 Chief Compliance Officer ................................................................................................................... 7

6.4 Corporate Secretary .......................................................................................................................... 7

7 Maintenance and Review ................................................................................... 8

8 Links ................................................................................................................. 8

9. Appendices ........................................................................................................ 9

Appendix 1 – Definitions ............................................................................................................................... 9

Appendix 2 – Jurisdictions in which CIBC FirstCaribbean Shares are Traded ............................................. 11

Appendix 3 – Legislation, Regulatory Guidelines and Penalties ................................................................. 12


Date: December, 2015 CIBC FirstCaribbean - Public of 13 Version#: 6.0(120915)

1 Summary

It is the policy of FirstCaribbean International Bank Limited (“CIBC FirstCaribbean” or “the

Bank”) to comply with all regulations and legislation relating to Insider Trading. The Bank is

obligated to identify Executives and Employees who are in positions that are privy to inside

information (collectively Insiders). Insiders must be made aware of (1) their obligations as

Insiders in respect of insider trading practices and reporting requirements under various

regional rules and regulations, and (2) the potential risk of regulatory sanctions, fines and

reputational damage from non-compliance.

2 Intent

The intent of this policy is to minimize risk that CIBC FirstCaribbean fails to comply with

applicable Insider Trading Regulations and legislation.

It is essential that CIBC FirstCaribbean’s reputation in the industry, in the market and with

its regulators is not damaged. Insiders must ensure that any Employee Account dealing

activities are conducted in accordance with this Policy. Employee Account dealing should be

conducted in such a way as not to conflict with their duties towards CIBC FirstCaribbean, its

subsidiaries, customers, suppliers, or any other public company with which CIBC

FirstCaribbean is involved with as a client.

2.1 Consequences of non-compliance

Insider trading is a crime in the countries where we do business. Accordingly, it is

imperative that all Insiders are fully knowledgeable of the CIBC FirstCaribbean Insider

Trading Policy.

Any person who violates the requirements of the applicable Insider Trading regulations and

legislation, may become liable personally to compensate parties who suffer a loss as a result

of trading. This liability extends to the person(s) to whom he or she communicated the

information. The Insider is accountable to the issuer for any benefit from misuse of the

information. In addition, a person who violates the Insider Trading Regulations and

Legislation could be liable for criminal and/or civil penalties (See Appendix 3 – Legislation

Regulatory Guidelines and Penalties).

3 Audience/Scope

Although the shares of FirstCaribbean International Bank Limited are only traded on the

exchanges in Barbados, the ECCU, and Trinidad and Tobago, Executives and Employees of

CIBC FirstCaribbean throughout the Footprint are eligible to trade securities on these

exchanges. Further, employees, by virtue of their position may become aware of material

non-public information on any publicly traded company regionally.

Accordingly, this Policy applies to all Executives and Employees of CIBC FirstCaribbean

International Bank Limited and its controlled subsidiaries (collectively “CIBC

FirstCaribbean”) that are identified as Insiders.



4 Policy Requirements

4.1 Obligations of CIBC FirstCaribbean Insiders

The onus is on each Insider to determine whether he or she is in possession of inside

information about CIBC FirstCaribbean or other publicly listed companies. They must

conform with Insider reporting rules internally and to the appropriate Securities

Commission.

In the event of uncertainty as to the appropriateness of a trade you should seek advice from

your line manager or the Compliance Unit.

The CIBC FirstCaribbean Code of Conduct - Section 4.2 - Managing Inside Information and

Personal Securities Trading states that Insiders of CIBC FirstCaribbean and their Connected

Persons must not:

a) Trade in securities of a public company including CIBC FirstCaribbean if they have inside

information about the company.

b) Disclose (or tip-off) such inside information to parties outside CIBC FirstCaribbean or

inside CIBC FirstCaribbean who do not have a need to know, except as required in the

normal course of business and/or in the execution of their governing contract.

c) Trade in securities of CIBC FirstCaribbean during black-out periods (See Section 4.5 –

Pre-Clearing Requirement), except where such securities form part of the Bank’s Share

Purchase Plan (ESPP). The concurrent sale of such securities to fund the transaction is

prohibited. Any shares so acquired must be held until the termination of the blackout

period.

However, an Insider:

a) Is permitted to make purchases or sales in a company’s securities in accordance with a

pre-existing written agreement; and, if such a transaction was approved in advance by

the Board

In order to facilitate identification, monitoring and reporting, Insiders must disclose to the

Corporate Secretary annually, the names of any Connected Parties by completing the

Annual Disclosure Questionnaire. Such declaration will include their securities holdings that

are managed by CIBC FirstCaribbean or any other publicly listed company.

4.2 Establishment and Maintenance of Insider Trading List

The Compliance Unit, in collaboration with the Corporate Secretary and impacted

businesses, will develop and maintain an Insider list, which will be updated periodically. The

List identifies the Directors, Senior Executives and Employees who are Insiders by virtue of

his/her employment, position, or other close association.

The Insider List is a key element used in monitoring Insider Trading Risk within the Bank.

Refresher training on the obligations of Insiders will be provided periodically in relation to

the CIBC FirstCaribbean Insider Trading policy and procedures.



4.3 Trading Windows

To protect Insiders and CIBC FirstCaribbean, fixed trading periods will be established

(known as a Trading Window). Subject to Compliance approval, Insiders may trade during

this period, providing they are not aware of Inside information.

The Trading Window is a 30 calendar day period which opens two days following the public

release of the quarterly results of CIBC FirstCaribbean. Trading Windows are communicated

annually by the Corporate Secretary followed by quarterly communication by Compliance.

4.4 Employee Account Trading

Insiders’ internal and external securities trading must be conducted in accordance with the

CIBC FirstCaribbean Insider Trading Policy. This essentially includes their holdings in, CIBC

FirstCaribbean and securities held in other publicly traded companies belonging to Insiders

and to connected persons over which the Insider has influence.

Insiders must declare their securities holdings annually to the Corporate Secretary by

completing the Annual Disclosure Questionnaire.

Insiders trading in securities for their own account must do so on an investment

basis rather than for short term trading profit.

4.5 Pre-Clearing Requirement

Insiders of CIBC FirstCaribbean must obtain prior approval from the Compliance Unit or as

required by local legislation for any securities transaction for their own Employee Account or

any accounts over which the Insider has trading authority or exercise influence. A decision

will be given by the Chief Compliance Officer or designate within a reasonable timeframe. It

is anticipated that any delay will be a rare occurrence. Losses resulting from a declined

trade cannot be absorbed by CIBC FirstCaribbean.

An approval is valid until the close of trading on the fifth business day following approval.

After this time has elapsed without the order having been filled, a fresh approval is

required.

If an Insider has a concern that a particular transaction may be in breach of this Policy or a

potential breach, he or she should discuss the matter with the Manager, Securities Trading,

Asset Management & Securities Trading or Compliance, prior to undertaking the trade.

4.6 Information Barriers (“Chinese Walls”)

To enable different business areas to carry on their functions, internal information barriers

(also known as “Firewalls” or “Chinese Walls”) will be established to properly control the

flow of confidential information from one part of CIBC FirstCaribbean to another.

Information barriers are discussed in the CIBC FirstCaribbean Code of Conduct - Section 4.2 - Managing Inside Information and Personal Securities Trading.

Generally, only those CIBC FirstCaribbean employees, who are directly involved in servicing

the client or who are necessary participants in the management and due diligence processes

of an investment banking transaction, sit behind a Chinese Wall. The CIBC FirstCaribbean

employees who are not directly involved in handling inside information do not sit behind the

Chinese Wall. However due to the role of some Executives and senior management they



may be brought over the wall enabling them to obtain information from both sides of the

Chinese Wall.

Insiders must be advised that they are bound by the same restrictions in relation to the

disclosure of the Inside information.

4.7 Black-Out Period

a) A black-out period is any period in which Insiders will be prohibited from trading due to

material developments within the company. Essentially the blackout period is the two

month period preceding the release of the quarterly financial results of CIBC

FirstCaribbean.

b) A black-out period also exists prior to the announcement of matters of a nature involving

price sensitive information which has not been disseminated to the public and which is

likely to affect the company’s share price or impact the market.

It is the responsibility of the Corporate Secretary to ensure that when the black-out period

is announced that it is overseen in conformance with the trading restrictions stipulated by

the securities exchanges in the jurisdictions in which CIBC FirstCaribbean shares are traded.

5 Monitoring/Oversight Mechanism

The Compliance Unit monitors trading of CIBC FirstCaribbean Insiders. CIBC FirstCaribbean

reserves the right to require an Insider to reverse a trade at their expense at the discretion

of and upon the instructions of Compliance Unit.

An overall summary of the monitoring completed for adherence to the Insider Trading Policy

will be included within the quarterly Compliance Management Information pack to the

Managing Director, Operational Risk and Governance at CIBC FirstCaribbean.

Policy breaches and material trades will be reported to the board as part of the Compliance

Report.



6 Roles and Responsibilities

6.1 The Chief Executive Officer (CEO)

The CEO should at least biennially, review and, if advisable, approve and recommend

this Insider Trading Policy and ensure that the Board of Directors receives periodic

reports on the trading activity of Insiders.

6.2 The Managing Director, Operational Risk and Governance

The MD Operational Risk and Governance owns this Policy and will:

a) Review and Recommend this policy and any amendments to the Senior Executive

Team (SET);

b) Provide effective oversight responsibility for the effective implementation of this

policy;

c) Present a report on the breaches of Insider Trading monitoring to the SET and

Board on a monthly and quarterly basis, respectively;

d) Delegate responsibility for this policy to the Chief Compliance Officer.

6.3 Chief Compliance Officer

The Chief Compliance Officer is the head of CIBC FirstCaribbean’s Compliance

Department and in that capacity has oversight responsibility for CIBC FirstCaribbean’s

Compliance programme. The Chief Compliance Officer manages this Policy. This

includes responsibility for:

a) Overseeing the implementation of this Policy;

b) Ensuring that the appropriate programs, systems and resources are in place to

address the identified inherent risks;

c) Developing, implementing and approving an effective compliance monitoring

program to ensure adherence to applicable Insider Trading regulatory requirements

and guidelines in each jurisdiction in which CIBC FirstCaribbean entities operate.

d) Delegate specific authority to the Compliance team.

6.4 Corporate Secretary

The Corporate Secretary in addition to its oversight function is responsible for setting

the black-out windows and the sales windows and filing disclosures to the securities

exchanges.



7 Maintenance and Review

This Policy is ‘owned and maintained’ by the Managing Director, Operational Risk and

Governance and managed by the Chief Compliance Officer.

The Policy will be reviewed at least biennially, or before if material changes are required.

Any substantive revision to the Policy will be referred to the CIBC FirstCaribbean Audit and

Governance Committee for review, advice and to the Chief Executive Officer for approval.

The next biennial review of this Policy will be in November 2017.

8 Links

Code of Conduct

Windows of Personal Trading of Shares Memo

Annual Disclosures Questionnaire

http://insidefirst.wi.fcib.com/uploads/HumanResources/GeneralInformation/Code%20of%20Conduct%20Manual.pdf



9. Appendices

Appendix 1 – Definitions

In this Policy, the following definitions apply:

a) “Connected Person” means the Executive’s spouse and immediate family members

living under the same roof, as well as any securities account(s) over which the

Executives has trading authority or exercises influence other than in the course of his or

her CIBC FirstCaribbean duties.

b) “Employee” refers to all CIBC FirstCaribbean full-time and part-time Employees, as

well as any other person that has been issued a CIBC FirstCaribbean Employee ID

number, including but not limited to: contingent workers, independent contractors,

temporary agency staff and students.

c) “Employee Account” means the Executive or employee’s own securities account(s)

and those of a spouse and immediate family members living under the same roof, as

well as any securities account(s) over which the Executive or employee has trading

authority or exercises influence other than in the course of his or her CIBC

FirstCaribbean duties.

d) “Executive” means a person with senior management responsibility who can put plans,

actions and policies into effect within CIBC FirstCaribbean.

e) “Insider” means Executives and employees of CIBC FirstCaribbean, who have inside

information, as well as, a spouse and immediate family members living under the same

roof, associate or affiliate of the Executive and employee, as well as any agent, person

or entity that owns significant holdings of CIBC or CIBC FirstCaribbean shares. This

includes anyone who trades CIBC or CIBC FirstCaribbean shares based on material non-

public information.

f) “Inside Information” means inside information is material, non-public information

about a public company. “Material” means that the information, if disclosed, would

reasonably be expected to have a significant effect on the market price or value of the

company’s securities, or could affect the decision of a reasonable investor to buy, sell or

hold a company’s securities (in other words, if the information is reasonably certain to

have an effect on the price of the securities, whether such effect is positive or negative).

Information ceases to be inside information only when it has been generally disclosed to

the public or is no longer material.

i. In relation to this policy, information includes but is not limited to:

Company or business unit financial results;

Potential default by an issuer on credit facilities at the bank or with any other

creditor;

A pending resignation or dismissal of one or more senior executives of an

issuer or one of its material subsidiaries;

Earnings per share;

Any change in the payment of dividends;

Possible mergers, acquisitions, divestitures, joint ventures or a take-over of

the issuer by another company;



Major litigation; and

Significant product development.

ii. “Issuer” means a person who has a security outstanding, issuing a security or

proposes to issue a security.

g) “Material non-public information” (See Appendix 1 – Definitions, Point b) - Inside

Information).

h) “Securities” means all obligations of a company or other legal entity traded as

marketable instruments. These will include shares, bonds, debentures, warrants, rights

and options. For the purposes of these guidelines, securities do not include:

i. Securities issued by federal, regional or local governments (or agencies thereof)

including guaranteed obligations;

ii. Short term instrument, such as certificates of deposit and guaranteed investment

certificates, of financial intermediaries including life insurance companies and

banks where these instruments are purchased for holding to maturity;

iii. Bankers acceptances, corporate bonds (except high yield bonds), or commercial

paper of non-financial institutions with a residual maturity of 270 days or less;

iv. Open ended mutual funds (or their equivalent);

v. Exchange traded funds;

vi. Non-equity options (e.g. index options);

vii. Foreign exchange; and

viii. Commodity futures.



Appendix 2 – Jurisdictions in which CIBC FirstCaribbean Shares are Traded

Jurisdiction SECURITIES EXCHANGE FCIB SHARES LISTED

Eastern Caribbean Currency Union (Antigua, Dominica, Grenada, St. Kitts & Nevis, St. Lucia, St. Vincent, Anguilla)

Eastern Caribbean Securities Exchange

Bahamas Bahamas International Securities Exchange

Barbados Barbados Stock Exchange

Belize Mercantile Exchange of Belize ltd

Cayman Cayman Islands Stock Exchange

Curacao Dutch Caribbean Securities Exchange

Jamaica Jamaica Stock Exchange

St. Maarten Dutch Caribbean Securities Exchange

Trinidad & Tobago The Trinidad & Tobago Stock Exchange

Turks & Caicos Islands No securities exchange N/a



Appendix 3 – Legislation, Regulatory Guidelines and Penalties

JURISDICTION LEGISLATION/ REGULATORY GUIDELINES

PENALTIES

Bahamas Securities Industry Act 2011 a) A fine of $150,000 or imprisonment for two years or both.

b) And shall return any gains made from the act if the court so directs.

Barbados Securities Act 2002

Securities Regulations, 2002

The Insider Trading Guidelines of the Barbados Stock exchange 2014

Financial Services Commission Insider Trading Guidelines

Companies Act 2002 – CAP 308

a) A fine of $10,000 or imprisonment for 2 years

Jamaica Securities Act 1993

339 The Securities (Amendment) Act, 2013

a) In the case of an individual, to a fine or imprisonment for a term not exceeding ten years; or

b) In the case of a company, to a fine;

c) A person who is convicted shall be liable to pay compensation to any person who, suffers loss by reason of the difference between the price at which the securities were dealt in, in that transaction and the price at which they would have been likely to have been dealt in.

Eastern Caribbean Currency Union (ECCU)

Securities (Conduct of Business) Regulations 2001

Securities Act 2001

a) In the case of an individual, to a fine of $200,000 or to imprisonment for a term not exceeding ten years; or

b) In the case of a company, to a fine of $400,000;

c) A person convicted of an offence …shall in addition to criminal liability for the offence, be liable, at the suit of any person who has sustained pecuniary loss as a result of having purchased or sold securities at a price affected by the act or transaction.



JURISDICTION LEGISLATION/ REGULATORY GUIDELINES

PENALTIES

Trinidad & Tobago

Securities Act 2012 - 17 a) A person who commits an offence and is liable to a fine of $5,000,000 and imprisonment for 7 years.

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