Lee Chin-linked default puts Guardian Group Dutch Caribbean exposure in focus, despite CBCS assurances

CARIBBEAN REGION--Regional media reported last week that Caribbean investors entered 2026 facing a fresh confidence test after three companies linked to Jamaican-born investor Michael Lee Chin failed to make the first scheduled payment under a recently approved debt restructuring.

The developments have drawn added attention in the Dutch Caribbean because NCB Financial Group (NCBFG), where Lee Chin is a major shareholder, holds a controlling stake in Guardian Holdings, the parent of Guardian’s operations in the Dutch Caribbean, including St. Maarten.

Missed payment after bondholders approved restructuring framework

The companies, Portland (Barbados) Ltd (PBL), AIC (Barbados), and Specialty Coffee Investment Company (SCI), secured investor approval in December across 14 bondholder groups to regularize more than US$297 million in obligations. Under the approved framework, the first payment was due December 31 and totaled US$94.1 million, made up of US$75 million in partial principal repayment and US$19.09 million in accrued interest calculated up to September 5, 2025. The principal tranche represented roughly 25% of the outstanding balance.

Instead of the payment, investors received a statement from Lee Chin saying a “structured and time-bound review” was underway at AIC (Barbados) to assess repayment options. The statement said the review was considering full repayment of the US$297 million, settling the US$94.1 million within the 45-day cure period, and a potential sale of Lee Chin’s NCBFG shareholding. Lee Chin added, “The process is focussed on identifying a responsible solution that best serves all stakeholders. I appreciate the constructive dialogue with bondholders and remain fully committed to meeting these obligations in an orderly and transparent manner.”

Trustee confirms non-payment, cure clock starts

In a late notice to bondholders, JCSD Trustee Services Ltd, trustee for the bonds, confirmed no payment was received on December 31 and advised that the issuer indicated an intention to remit the funds on or before January 26.

The trustee also pointed bondholders to the resolution terms, stating: “In accordance with the resolution, if both payments at (a) and (b) are not made, the trustee is committed to pursuing the instructions outlined in the resolution. We will provide an update on the steps being taken in accordance with the provisions of the resolution for conditional forbearance in the week of the 5th of January 2026,” with (a) referring to the US$19.09 million and (b) to the US$75 million.

Collateral and shortfall

The US$297 million debt is secured by 1.024 billion ordinary shares in NCBFG, equal to 39.62% of NCBFG’s issued share capital. The article reports the pledged share collateral was valued at US$248.76 million on Wednesday, about US$50 million short of the amount it is meant to secure.

The article also cites NCBFG’s July 2025 international bond prospectus for US$225 million notes, which indicates 50.5% of NCBFG shares have already been pledged as collateral for bonds issued by companies majority-owned by Lee Chin, including AIC, AIC Global, and Portland Holdings Inc.

What the missed deadline activates

The failure to pay on December 31 activates several embedded provisions:

• Default interest now accrues on the missed US$94 million balance from the date of default.
• A 45-day cure period is now running, during which the missed payment can still be made.
• If the cure period expires without payment, the trustee would be required to issue a notice of acceleration, making the full outstanding balance immediately due and payable.
• Enforcement would then follow, including potential seizure of the 1.024 billion NCBFG shares pledged as security.

Reference is also made to a January 1 report by the Jamaica Observer indicating that the missed deadline activates noteholder instructions to pursue legal enforcement, including filing an originating summons and fixed-date claim before the Jamaican Supreme Court. The restructuring further requires a comprehensive repayment plan for the remaining US$203 million principal by March 31.

A further constraint cited is that no pledged NCBFG shares will be released until the debt is fully repaid, with dividends applied against accrued interest.

Recent precedent adds to concern

Reporting points to April 2024, when AIC (Barbados) missed a US$23 million bond payment and later negotiated revised terms through a trustee. That episode included delayed and incomplete payments and an interest increase from 8.25% to 12.25%, and NCBFG shares were reportedly sold on the Jamaica Stock Exchange around that period to address funding pressures.

Where Guardian and the Dutch Caribbean come in

Media reports note broader regional monitoring because of NCBFG’s capital structure and its link to Guardian Holdings. It states that NCBFG’s international bond contains a change-of-control clause that would require NCBFG to repurchase the entire US$225 million bond at 11% interest if a single party or group acquires 50% or more of voting power. That bond is secured by NCBFG’s 61.77% stake in Guardian Holdings, and the value of that Guardian stake is cited at US$313.29 million on Wednesday.

NCBFG’s share price moved lower after confirmation of the missed payment, and the stock finished 2025 down 23% on the Jamaica Stock Exchange and 19.67% on the Trinidad and Tobago Stock Exchange. The market capitalization figure cited is approximately J$100.45 billion, or about US$627.81 million.

CBCS assurances, and what they do and do not cover

The Central Bank of Curaçao and St. Maarten (CBCS) has previously sought to reassure the public that the locally operating Guardian insurers in the Dutch Caribbean are separately regulated, are expected to meet prudential requirements, and operate as legally distinct entities with their own financial resources, while the CBCS continues monitoring developments.

Those assurances reduce the likelihood of an immediate operational shock inside the regulated local entities. They do not eliminate risks that sit higher up the chain, at the level of ownership, pledged collateral, and group financing.

Five specific (possible) risks Guardian still faces despite the assurances

1. Forced sale or control instability at NCBFG
   If creditor enforcement leads to seizure and sale of pledged NCBFG shares, NCBFG’s ownership can shift. Because NCBFG controls Guardian Holdings, that can translate into uncertainty over Guardian’s controlling shareholder, with potential knock-on effects for board direction and strategy.
2. Encumbrance risk tied to NCBFG’s own bond
   The article states NCBFG’s US$225 million bond is secured by its 61.77% Guardian Holdings stake. In a stress scenario at NCBFG, that collateral structure can create pressure for monetization or restructuring involving the Guardian stake.
3. Change-of-control trigger risk
   A buyer or creditor group reaching 50% voting power in NCBFG could activate the repurchase obligation on the US$225 million bond at 11% interest, creating a sudden funding need that can intensify pressure to raise cash quickly, potentially via the Guardian stake.
4. Dividend and liquidity extraction pressure
   Even without direct enforcement against Guardian, group-level liquidity stress can create incentives to pull cash upward, including stronger dividend expectations or reduced reinvestment flexibility, subject to regulatory limits in each jurisdiction.
5. Market confidence and valuation risk
   The reported collateral shortfall, combined with a weakening NCBFG share price, can widen funding gaps and harden creditor positions. That environment can increase the likelihood that Guardian becomes viewed as a core liquidity source in any broader resolution.

CBCS assurances speak to the separate regulation and financial independence of locally supervised Guardian entities in the Dutch Caribbean. But the reports still highlights meaningful risk at the shareholder and financing level: NCBFG share enforcement, collateral structures, and change-of-control clauses can create pathways where Guardian Holdings becomes subject to heightened ownership uncertainty, pressure to monetize the stake, or strategic disruption, even if the regulated operating companies remain compliant and stable.

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