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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
Insider Trading Policy
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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.
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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.
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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
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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.
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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.
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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
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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;
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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.
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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
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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.
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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.