SAFEGUARDS to protect delinquent mortgage borrowers from losing their homes are poised for review with a senior banker warning they were “carrying us down the path to hell” despite the noble intent.
Gowon Bowe, the current Clearing Banks Association (CBA) chairman, revealed to Tribune Business that potential reforms to the Homeowners Protection Act are set to be assessed by a working group featuring representatives from the industry plus
Ministry of Finance and Attorney General’s Office officials.
He explained that “lack of clarity”, and practical difficulties with implementing the Act, had merely increased the risk associated with mortgage lending by making it more costly, time consuming and uncertain for banks when it came to repossessing or selling properties pledged as collateral by delinquent borrowers.
The effect, the Fidelity Bank (Bahamas) chief told this newspaper, can be seen in the $133.7m contraction in the Bahamian banking industry’s total outstanding mortgage portfolio in the four years to end-December 2023. The end result is heightened reluctance and unwillingness to extend
mortgages, which is threatening Bahamian home ownership dreams and housing market activity.
“There are quite a number of issues, and not going into the weeds necessarily, but there are practical implications in the Homeowners Protection Act,” Mr Bowe said, while asserting: “Legislation should not prohibit commerce.”
As an example, he pointed to the section in the legislation that imposes restrictions on the family members of bank employees from buying or making offers on distressed
By NEIL HARTNELL
Business Editor
BAHAMAS Power & Light’s (BPL) financial crisis was yesterday further exposed by negative net profit margins of -20 percent and -24 percent for the past two financials years when it was unable to cover its debts.
The Utilities Regulation and Competition Authority (URCA), unveiling the findings of a BPL performance and organisational audit conducted by a thirdparty consultant it hired, revealed that the stateowned energy monopoly is operating inefficiently as its return on assets for 2023 financial year was a negative -12 percent.
Castalia, the consultant engaged by URCA, also disclosed that BPL was likely unable to cover interest and other payments
on debts totalling several hundred million dollars by itself because of negative debt service coverage ratios that plunged as low as -8.8 for the 12 months to end-September 2022. There was a slight improvement to a -2.2 ratio in 2023, but BPL’s external auditors have consistently qualified the state-owned enterprise’s (SOE) accounts by invoking the “going concern” phrase for the past seven years since 2017. The negative debt service coverage ratios likely mean BPL’s debt obligations had to be at least partly covered by the injection of government, or Bahamian taxpayer, monies.
However, URCA’s summary of the consultant’s findings confirmed that BPL’s financial health would receive a major boost if the Government paid its electricity bills.
• Utility likely unable to cover debt since
• No action despite Gov’ts unpaid $89m bills
• Concerns higher-cost generation used first
Castalia said government ministries, agencies and departments owe a collective $89 in unpaid light bills with no attempt by BPL to enforce disconnections or standard collection procedures on this customer category.
Asserting with deft under-statement that BPL “is in a poor financial position, URCA affirmed:
“BPL has been operating at a loss since 2022. Its net profit margin was -20 percent and -24 percent in financial year 2022 and financial year 2023, respectively. Since financial year 2017, BPL’s net profit margin has averaged -2 percent.
PAGE B20
URCA: BPL must slash outage frequency 40%
By NEIL HARTNELL
BAHAMAS Power & Light (BPL) must reduce the frequency and length of power outages by 40 percent and 60 percent, respectively, to meet standards set by its regulator, it was revealed yesterday.
The Utilities Regulation and Competition Authority (URCA), unveiling the findings of a consultant’s performance and operational audit of the state-owned utility, said there was much room for
improvement with total losses from BPL’s distribution grid having increased by more than 25 percent since 2017.
Castalia, the consultant, also found that BPL’s infrastructure lacked any redundancy or excess capacity to cope with peak summer demand should a substation or “critical network component” fail. Some 10 percent of substations were said to need replacing, with an equal percentage requiring an upgrade or repairs.
And the audit reported that the availability of
BPL’s generation capacity is low compared to the industry average at 66 percent and 61 percent for New Providence and the Family Islands, respectively, while affirming that maintenance is “often deferred” due to limited reserve capacity and parts inventories.
Giving an insight into why the Government has accelerated its energy reform plans so sharply, URCA said of the findings:
“BPL needs to invest an estimated $500m to refurbish and replace its aging
generation, transmission and distribution assets.
“The network needs investment, as it is reaching maximum capacity: There is no N-1 (spare unit) redundancy in the summer peak should one substation or critical network component go down. Around 10 percent of substations need replacing, and another 10 percent need an upgrade or repair. Further, some base designs are over 20 years old.
“Investment in the grid can also help reduce losses. System losses in New
PAGE A19
‘Tremendous concern’ on Silver’s Bimini airlift halt
By FAY SIMMONS Tribune Business
TOURISM executives yesterday said it was “a tremendous concern” that Bimini’s major source of commercial
cancellations. “Unlike a lot of islands in The Bahamas, Bimini’s high season is the summer. We’re being negatively impacted by this in our best season.
“You cannot replace them. You cannot send another 40-70 seater in there until such time as they have a fire truck.
IATA (the International Air Transport Association) won’t allow that. Silver Airways, in a statement, told passengers that due to South Bimini Airport’s “inability to repair their firefighting and rescue
vehicle” it was suspending all flights until this Friday.
It added that the fire truck has been “unserviceable” since July 24 and, despite “repeated requests for updates and solutions”, the issue has not been resolved. “Silver Airways regrets to inform you that all flights to and from South Bimini Airport (BIM) are expected to be cancelled through August 2, 2024,” the airline said.
“Unfortunately, this disruption is due to the airport’s inability to repair
PAGE A20
AML Foods yesterday said it has “expanded our ambitions” to now target becoming a “$300m company by 2030” as its top executive asserted: “We are bullish on our industry.”
Gavin Watchorn, the BISX-listed food retail and franchise group’s president, told Tribune Business it has “a road map of opportunities” before it following the reopening of its Solomon’s Old Trail store that will now serve as “the model” for further expansion of its neighbourhood grocery outlet model.
Revealing that AML Foods has raised its total sales target by 20 percent, or $50m, compared to the $250m goal it unveiled just three years ago, he also disclosed that the group is in the final stages of a $2m
project to solarise all its New Providence properties and take them “70-80 percent off the grid during the day” to drive significant energy cost savings. Mr Watchorn told this newspaper the growth strategy is focused on staff - and not just expanding the store network - through the goal of ensuring 85 percent of all promotions go to existing employees. And he added that the “big focus” placed by the group on reducing shrinkage, meaning the loss of product to theft, damage or going bad/past its sell-by date, was now paying off in its financial results.
Having completed the conversion of Solomon’s SuperCentre into its neighbourhood food store format, AML Foods is now focusing on the relocation of its Cost Right brand from the Town Centre Mall to the same Old Trail
GOWON BOWE
Tourism body readies for next Venture Pitch phase
THE Tourism Development Corporation (TDC) says it has completed the first phase of its Venture Pitch programme by selecting winners for Nassau, Exuma and Grand Bahama.
The initiative, designed to help small and mediumsized enterprises (SMEs) create interactive websites, source funding and partner with end-users, will be extended across all islands of The Bahamas. The second phase, covering Andros, the Berry Islands, Bimini, Cat Island and Eleuthera, is now poised launch.
The recent competitions selected the following winners: Nassau:
* First Place: Rotalya Williams – $10,000; second place: Neil Dames – $8,000; third place: Rhondi Treco – $6,000 Exuma:
* First Place: Johnette Moss – $10,000; second place: Lanardo Rolle – $8,000; third place: Tahjmann Smith – $6,000 Grand Bahama:
* First place: Ostia Thomas – $10,000; second place: Taria Lundy – $8,000;
third place: Krishona Minnis – $6,000 The TDC was created to spearhead numerous initiatives designed to support small and medium-sized enterprises (SMEs) and enhance the overall tourism experience in The Bahamas. It has established its first Incubator Centre on East Bay Street to provide affordable spaces for Bahamian entrepreneurs to showcase and sell locally-made products, with a special focus on Bahamian crafts, souveniurs and wares.
CHESTER COOPER, deputy prime minister and minister of tourism, investments and aviation, champions local entrepreneurs at the TDC Venture Pitch Series in Nassau.
“Tourism is the lifeblood of our nation’s economy, and our administration fully believes in its capacity to transform lives, empower communities, drive innovation and accelerate entrepreneurship like never before,” said Chester Cooper, deputy prime minister and minister of tourism, investments and aviation. “The Tourism Development Corporation and the Tourism Development Fund are at the forefront of this transformation.”
TDC Venture Pitch winners in Exuma.
LABOUR BODY YET TO SEE NEW MINIMUM WAGE RISE
any chance of seeing a return on their investments.
THE body responsible for dealing with all labourrelated matters in The Bahamas has not discussed any proposed minimum wage increase because it has not been reformed since July 1.
Peter Goudie, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) representative on the National Tripartite Council, told Tribune Business that it cannot meet until the Government reconstitutes it by appointing new members.
His comments came as Raymond Jones, the Bahamas Petroleum Retailers Association’s (BPRA) president, said another minimum wage rise would further increase the “hardship” petroleum retailers face as their margins have remain unchanged for 13 years despite higher operating costs.
He added that gas retailers have been “suffering and operating at a loss” for years, and their fixed margins have “totally eroded”
Mr Jones said: “A further increase in the minimum wage is only going to increase the hardship that petroleum retailers in this country are facing. We want to be like any other entrepreneur, be able to adjust our costs based on the rising cost to do business, not to put on an extra burden.
“The gas station retailers have been suffering and operating at a loss for many, many years now. It’s virtually impossible to make a dollar. The issue we have is simply that the increase in costs against a fixed margin has totally eroded any sense of getting a return on investment at this point. We’re operating because we’ve got too much invested to give up.”
Mr Jones argued that increasing the minimum wage without granting a gas margin increase would add “another burden on top of a donkey that can’t walk right now”, and called for the dealers’ request to add 25 cents per gallon on gasoline and 15 cents per gallon on diesel to be granted.
He said: “We’re not going to dispute the Government’s analysis of a need to put in a minimum wage
increase. But we’ve seen the price for our costs to operate go up, and I understand the need for price adjustment.
“All we’re asking for is to be treated the same and recognise that we need the price adjustment on our margin so we can survive. Another minimum wage increase is just another burden on top of a donkey that can’t walk right now.
“We’re not against the efforts to try to help the working public and residents to have a living wage. We want the same thing. We deserve the same thing, a living wage in terms of having a margin that can cover the costs to operate, because we’re not like other retailers who can adjust our margins based on our rising costs.”
Gas retailers have not received a margin increase since the then-Ingraham administration granted one 13 years ago. Unlike virtually all other industries, which are able to increase prices to cover rising operating expenses, the Bahamian petroleum industry operates on pricecontrolled fixed margins that require government approval before they can be changed.
Dealers say that, especially following the post-COVID cost of living crisis, ever-rising expenses have effectively wiped out the 54 cent and 34-cent margins per gallon of gasoline and diesel sold, driving them into losses and placing some in a position where they are threatening to close their operations. The Government, though, has been reluctant to raise the margins for fear it will increase fuel bills for motorists.
Mr Jones said there is an “urgent and immediate” need for gas retailers to be granted a margin increase as operation costs such as insurance, NIB and electricity have increased over the last decade. He explained that the 25 cent margin increase would translate to the cost of a 12 ounce bottle of water to consumers weekly, but will greatly improve their ability to pay operating costs.
He said: “We’re praying and hoping that the Government, after studying for the last two years all the data we’ve given them, realise there is an urgent need and immediate need for us to have an increase. That will allow us to breathe and pay our bills, and be able to
continue to operate without stressing out about not making any money.
“The cost of power increased. We’ve had cost of minimum wage increase before, the cost of increased insurance, the cost of depositing cash at the bank, credit card fees. We welcome the digital age, but there is a cost to us against a fixed margin. On July 1, we saw an increase in National Insurance. What we are seeking in terms of an increase will amount about a bottle of water to the average consumer per week.”
Mr Jones said the cost of gasoline has decreased by $2 per gallon in the past two years, so consumers have already seen the benefits of a price reduction, but retailers who are operating on a fixed margin would see their operating losses increase with a minimum wage increase. He said: “In discussions with the Government over the past few years they said wait for a reduction in the cost of fuel. Well, today fuel is literally $2 a gallon cheaper than it was two years ago. So, the public is getting a benefit of a reduction. A further increase in minimum rates would
continue to erode and increase our operating loss from a fixed margin that has been totally decimated with the rising costs.
“We’d love a big increase, but we recognise that it’s a consumption market and the consumers are paying a fair price for our products. We want to provide the service and to operate so we can actually achieve some sense of an operating profit.”
Pia Glover-Rolle, minister of labour and the public service, said the Davis administration wants to increase the minimum wage again soon butdid not give a timeline for when a decision would be made. She said officials had discussed the matter with a senior economics wage specialist at the International Labour Organisation.
The Davis administration increased the minimum wage from $210 to $260 in January 2024. That was the second increase since the Ingraham administration introduced the minimum wage in 2001 at $150 per week. Some workers said the increase did not go far enough given rising food and electricity costs.
NOTICE
TO: Dedrie Williams Tall Pine Subdivision Nassau, N. P., Bahs.
‘STRONG INTEREST’ STILL IN BAHAMAS SHIP REGISTRY
A CABINET minister has urged Bahamians to pursue maritime industry careers with this country’s shipping registry continuing to attract “strong interest”.
Jobeth Coleby-Davis, minister of transport and energy, told the LJM Maritime Academy graduation ceremony that the sector’s continued expansion means more lucrative job opportunities are available to Bahamians.
“With global trade expected to grow significantly over the next decade owing to the rise of the global middle class, the maritime industry is expected to play a significant role in facilitating that growth in a sustainable and efficient manner,” she said.
“The Bahamas stands as a clear example of the growth that the maritime industry is experiencing.
“Our country’s ship registry is the eighth largest in the world and comprises over 1,550 ships totalling more than 63 million gross tonnes. It is also the largest flag for passenger ships and one of the largest for gas carriers.
TAKE NOTICE that Everette Hart of Exuma Point, Exuma, Bahamas, has begun an action against you, Dedrie Williams, being Claim No. 2023/CLE/gen/00944 in the Supreme Court of the Bahamas by Fixed Date Claim dated 4th. day of October, A. D. 2023, which Fixed Date Claim is endorsed as follows:
1) Possession of the land situate at the junction of Rockdale Road and King’s Highway leading into Exuma Point (hereinafter called “the land) and or a declaration to the effect that they are entitled to possession thereof.
2) An injunction restraining the Defendant from entering or further entering upon the land or in any manner interfering with it.
3) Damages for trespass and loss of use of the land.
it to the court at the 1 . Floor, Ansbacher House, Bank Lane, Nassau, N. P., within 28 days of the last publication of this action.
4) Further or other relief.
5) Costs
If you return the acknowledgment of service form to the Court as above stated you must also serve on the attorney for the Claimants within 14 days of the time limited for returning the acknowledgement of service a defence otherwise judgment may be entered against you without notice.
You may obtain from the attorney for the Claimants an acknowledgement of service form and all other documents required to be served with the fixed date claim.
And you are required within 28 days after the last publication of this notice to cause an acknowledgement of service to be returned to the Supreme Court, and in default of your so doing the said Everette Hart may proceed therein and judgment may be given in your absence.
You may fully complete the acknowledgement of service form and return it to the court at the 1st. Floor, Ansbacher House, Bank Lane, Nassau, N. P., within 28 days of the last publication of this action.
If you return the acknowledgment of service form to the Court as above stated you must also serve on the attorney for the Claimants
“Several weeks ago, I was on a working visit to Greece, where I met with several Greek ship owners who expressed a strong interest in The Bahamas ship registry and having their new vessels under the Bahamian flag,” Mrs Coleby-Davis said.
“Additionally, Royal Caribbean International’s latest cruise ship, Star of the Seas, which is currently being built in Finland and expected to enter service in August 2025, will be registered in The Bahamas. With this growth and expansion, the need for more highly skilled seafarers will become more important.” The minister, pointing to numerous different job opportunities, said: “A master captain in the merchant shipping sector can earn between $8,000 to $14,000 per month, while a junior officer may earn $2,000 to $6,000 per month. A captain on a large yacht can earn between $10,000 to $20,000 per month, while a junior officer may earn between $3,000 to $6,000 per month.”
group photo. From left: Ricardo Charlton, director of operations, Port Everglades; Dr Brendamae C. Cleare, president LJM Maritime School; minister of energy and transport, JoBeth Coleby-Davis; Lowell J. Mortimer; chairman, Chandler Sands; academic dean, Ecarscha Smith. Standing: Cohorts from 2020 and 2021 graduation, and cohort 2022’s pre-sea passing out.
CHAMBER ‘CAUTIOUS’ OVER NEW MINIMUM WAGE TALK
By FAY SIMMONS
THE Chamber of Com-
merce’s chief executive
yesterday said the private sector already faces “a myriad of challenges” apart from having to contend with a new minimum wage increase.
Dr Leo Rolle, responding to indications by Pia Glover-Rolle, minister of labour and the public service, that the Davis administration wants to increase the minimum wage again, said the Chamber has been offered a “seat at the table” to discuss an issue that could “trigger” an increase in prices to “offset” a rise in operations costs.
He said: “In light of the minister’s statements yesterday on a potential increase to minimum wage, we note that whenever there is an impact to the bottom line of a business it will ultimately be felt through inflation, which
triggers an increase in the prices of goods and services to respond to and offset the increased cost of doing business. “The business community contends with a myriad of challenges that impact the ease and cost of doing business, which translates to a loss of profitability, so we remain cautious on any proposed revisions that result in the same.”
Dr Rolle said the Chamber will be releasing a survey to gain feedback from its members on how another minimum wage increase so soon would impact their businesses and relay those concerns to the Government. He added: “The Chamber prides itself on consultation with its constituents and will be circulating a survey to our members to garner their input on how they have fared since the most recent increase, coupled with their concerns and commentary on the newlyproposed increase as suggested by the minister.
“It is only then that we can provide an informed
University launches president search
THE search for the next University of The Bahamas (UB) president is underway after its board of trustees released a document detailing what it is seeking from the new hire.
The university, in a statement, said it released ‘The presidential opportunity at UB’ document on July 29. It details the nominee and applicant qualifications it is seeking, which are based “on the insights and
feedback gleaned from listening sessions held with various stakeholders”.
UB said it is looking for a candidate whose vision and goals align with that of its own, and “a dynamic and inclusive leader who will embody a commitment to the values and traditions of the university”. Leadership qualities, and fund and fundraising management, are other qualities desired by the profile. Applicants and
position from the business community. We also look forward to the Government sharing any research on the impact of such an increase on the overall economy as the discussion continues.”
Darrin Woods, the Bahamas Hotel, Catering and Allied Workers Union president, said his members would “welcome” any additional minimum wage increase to combat inflation and improve their standard of living. He added it has become increasingly hard for Bahamians to “keep pace” with rising inflation and the increase would aid in moving citizens above the poverty line.
“The inflation rate rises so quickly it’s hard to keep pace with it. So anything that will be beneficial to the membership, to the wider body, is welcome,” Mr Woods said.
“Our members are the people who go to the food stores, the gas stations, the hardware stores, and if we can try to lift the standard of living for everyone across the board to wipe out the low income and try
nominees must submit have all required documents and information by September 19.
Allyson Maynard-Gibson KC, UB’s chair, and vicechair Gadville McDonald will work alongside the tenmember presidential search committee to select the best candidate .The winner will be the ninth president of the university, succeeding Janyne Hodder, whose tenure ends in June 2025.
The new president’s tenure will also mark the 50th anniversary of the University of The Bahamas, formerly the College of The Bahamas.
to move more people into the middle class, that’d be vitally important. It’s important to try to lift people above the poverty level, across the board and throughout the country.”
Mr Woods, recognising that increasing the minimum wage would add to an employer’s operation costs, of which labour is the biggest component, said in putting all “heads together” The Bahamas can move towards a wage rate that both employers and employees can be comfortable with.
He added that the private sector would benefit from concessions to help “ease the burden” of an increased minimum wage rate and prevent the inflation rate rising further.
Mr Woods said: “Of course, we know the employers are going to do what they have to do in terms of combating it, standing up against it because at the end of the day that’s the way they make sure that they are able to curb their expenditure. We recognise in the
Regulator
same tone that labour is the biggest component of any organisation.
“I know it’s not going to be a one-sided thing. Of course, I know that the Chamber of Commerce, who was also the representative for the employers, will also have to be involved, but I believe if we could put our heads together we could move to a more liveable wage.
“I’m certain that the Government could do something to help the employers to ease the burden. Whether it’s by way of more concessions, tax cuts or rebates, once we are able to come together as a unit we can find ways to make it balanced for everyone.”
Mrs Glover-Rolle said unions will be included in the discussions about increasing minimum wage, adding: “You have my commitment to that. Not only will you be included, but you will be informed because I will make sure that it’s not said that our stakeholders were not aware of our plans and
hails replacement of ‘12 year-old’ securities law
THE Securities Commission yesterday hailed the replacement of the “12 year-old legal framework” that governed the Bahamian capital markets with a new law that took effect on Monday.
Christina Rolle, the regulator’s executive director, said in a statement that the upgraded Securities Industry Act “incorporates
feedback from over the past decade, and a thorough review of prevailing international standards and principles, including those endorsed by IOSCO, the FATF, the OECD and the IMF”.
The Securities Commission said the legal reforms have made the securities and capital markets regulatory framework “more
were allowed to mistakenly believe that this increase is not a high priority for this government.”
The announcement that an increase in minimum wage is imminent is a stark contrast to the stance the Davis administration took last year. Last November, Obie Ferguson, the Trades Union Congress (TUC) president, announced his union’s plans to lobby for another minimum wage increase.
Mr Ferguson said the union wanted at least $350 per week and was prepared to “take a strike vote” as a means to pressure government and private employers over outstanding labour issues.
Mrs Glover Rolle, at the time, said the Government would not support another increase to the country’s minimum wage so soon after the last wage hike was introduced and believes calls from union leaders over the issue are “a little reckless”.
robust and agile.” Under the new law, the regulator has full authority to file a criminal complaint, with the changes ensuring The Bahamas keeps pace with international standards and best practices.
“The Securities Industry Act includes a modern regulatory framework for derivatives, potentially enhancing the attractiveness of The Bahamas as a jurisdiction for derivatives business,” the Securities Commission added.
For example, in financial year 2023, BPL’s EBITDA (earnings before interest, taxation, depreciation and amortisation) margin was 7 percent, its current ratio was 120 percent and its return on assets was -12 percent.”
Pointing to further negatives, URCA added: “The audit highlighted BPL’s debt service coverage ratio has been negative for the last two years, reaching as low as -8.8 in 2022 and -2.5 in 2023. This has been an ongoing issue for BPL.
“Since at least financial year 2017, auditors have noted that ‘conditions may cast doubt on the company’s ability to continue as a going concern’ and expressed doubt that ‘BPL will have sufficient financial re-sources to meet its financial obligations as and when they come due’.”
No dollar figures were provided by URCA, but Jobeth Coleby-Davis, minister of energy and transport, revealed in a release last month that BPL’s annual operating losses have now reached as high as $60m. Yet one source, speaking on condition of anonymity, yesterday alleged that BPL was “close
to turning the corner” and “close to returning to profitability” when the Minnis administration was voted out in 2021.
The findings, though, will likely be seized upon by the Davis administration to justify the rapid pace with which it is now driving reform at BPL and in the wider energy sector despite concerns about the proposed structure and lack of competitive bidding for both the baseload generation and transmission and distribution (T&D) contracts. For the results show the status quo at BPL is simply unsustainable.
While Castalia’s report branded BPL’s metering and billing processes as “effective”, its assessment was less bright when it came to collecting due payment in full and on time from customers - especially where the Government and public sector are concerned.
“Collection from government customers is much lower compared to other customer categories. BPL does not enforce disconnection and arrears control processes on government customers, which has led to receivables from Government customers of about $89m,” URCA said in its results summary. And, for all customers, the average time to collect bills has increased by 61 days in the seven years since 2024.
‘Tremendous concern’ on Silver’s Bimini airlift halt
“The audit reveals that the collection rate has remained relatively consistent, averaging 93 percent in the past four years. Collections dropped to 87 percent in 2020 during COVID,” URCA added. “Compared to benchmarked utilities, BPL’s customers take longer to pay. BPL’s average collection period is 135 days, an increase of 45 percent from 74 days since 2017.”
That means, on average, that the time taken to collect on BPL customer has increased by almost two months since 2017. Castalia, meanwhile, also voiced concern about BPL’s management of its generation assets and “Shell’s monopoly on fuel” supply which it blamed for high costs.
On the former issue, URCA said the consultant found BPL did not always prioritise bringing its lowercost generation assets online first - something that breached its public electricity supplier licence. It added that BPL was using Aggreko’s rental generators “continuously as baseload” even though they operated on more expensive fuel compared to the utility’s own assets.
“Dispatch in New Providence is not fully based on a merit order,” URCA said. “BPL’s licence requires BPL to establish and operate a merit order dispatch
FROM PAGE A24
their fire fighting and rescue vehicle, which has been unserviceable since July 24, 2024. Despite repeated requests for updates and solutions, the airport has not been able to resolve
to provide the least-cost generation capacity. Currently, dispatch is not fully based on a merit order because of constraints with HFO (heavy fuel oil) handling and the take-or-pay charges with independent power producers.
“BPL-owned units are cheaper to run but are dispatched after the more expensive rental Aggreko units. The Aggreko units, with an average variable cost of 21 cents per kilowatt hour (kWh), run continuously as baseload. BPL and Bahamas Utilities Company-owned HFO units are cheaper, with the average variable cost between 12 cents and 15 cents per kWh.”
Given present energy costs it appears likely that the per KWh charges cited here are fuel charges only. And BPL, in its feedback to Castalia’s findings, disputed that it was bringing highercost generation assets online first and not managing its fleet properly.
“In response to Castalia’s assertion that ‘dispatch is not fully based on a merit order because of the take-or-pay charged with independent power producers (IPPs),” BPL posited that it is incorrect and further stated that, under normal conditions, BPL would not dispatch Aggreko units before a Bahamas Utilities
this critical safety issue, leading to the necessity of cancelling flights to ensure passenger safety.”
Tribune Business understands the fire truck is over 44 years-old. The Ministry of Tourism, Investments and Aviation, in a statement, said the Airport Authority has secured the part needed for the fire truck and repairs will be completed by Thursday.
It added that despite “proactive preventative maintenance” the decades-old fire truck still experienced mechanical woes. However, a new fire truck is headed to South Bimini and will arrive next week.
Company HFO/ADO unit. The Merit order is generally followed but is subject to plant availability,” BPL said.
But, elsewhere, URCA said: “The audit found that BPL does not have a least cost generation and system plan in place, or a set process, to develop and maintain system planning whilst there are opportunities for BPL to reduce its generation costs.
“Fuel makes up more than half of BPL’s operating expenditure. Fuel costs are mainly high due to Shell’s monopoly on fuel provision. Shell has an effective monopoly on fuel supply, maintains a large fuel storage facility in Freeport through its sole licensed distributor, FOCOL, and a Shell licensee is contracted for the onward delivery of ADO (automated diesel oil) to Family Islands.” Tribune Business, though, was told that BPL’s fuel supply contract is put out to competitive bidding.
They added that where the “monopoly” comes in is the shipping of fuel to BPL’s Family Island plants because only BISX-listed FOCOL Holdings possesses a fleet of ships able to perform the job. The same entities - Bahamas Utilities Company, which is a FOCOL Holdings subsidiary - are now poised to supply New
Providence’s baseload energy needs through the construction of a new 177 mega watt (MW) power plant at Blue Hills that will primarily use liquefied natural gas (LNG) as its fuel. Key terms, including the price at which energy will be sold to BPL and the contract’s duration, have not been disclosed.
“The audit found that apart from the obvious mandate of ‘keeping the power on in The Bahamas’, BPL staff are unsure of the company’s long-term vision and values. Staff believe that BPL’s mission and vision should evolve to meet sector developments,” URCA said.
“According to the audit, BPL is focused on short-term objectives as a coherent long-term strategy does not seem to exist. BPL does have a 100-day strategy plan as of November 2023, but it does not include details and specificity.
“Strategic planning appears to be a senior management activity with minimal staff input. There appears to be limited sharing and feedback of key information across the organisation such as operational plans, both from top-down to lower levels and across departments/ functions.”
multi-million dollar South Bimini Airport,” the Ministry of Tourism, Investments and Aviation added.
“Bimini remains a very important hub for domestic and international traffic.
“Mechanics from the Airport Authority are expected to arrive in Bimini tomorrow, Wednesday, July 31, 2024 and repairs are expected to be completed by Thursday, August 1, 2024. This was communicated to Silver Airways.
“In addition to the urgent immediate repairs, a new fire truck was acquired for South Bimini and has been enroute with an expected arrival within the next week, well ahead of the anticipated groundbreaking for the new
“This cancellation was attributed to an aged fire truck that experienced a mechanical issue in spite of proactive preventative maintenance. Upon notification, the Airport Authority immediately began an urgent sourcing for the replacement mechanical part, which has since been secured,” the ministry said.
We value our relationship with airline stakeholders, including passengers, and apologise for any inconvenience and disruption to their travel plans.”
The Davis administration launched a $260m Family Island Renaissance Programme to transform 14 airports and improve their deteriorating state.
South Bimini Airport is slated to receive an $80m upgrade. The Bimini Airport Development Partners (BADP) consortium has faced backlash from private aviation operators over increased fees since they took over the management and renovation at the airport.
Dr Kenneth Romer, director of aviation, said the issue has been discussed with Chester Cooper, deputy prime minister and minister of tourism, investments and aviation, and it was determined “there is a price” for ensuring Family Island airports are brought up to standard. He maintained that the Department of Aviation is open to making changes to these fees upon feedback from residents, but will continue to do “what needs to be done” to ensure Family Islands have proper airport infrastructure.
URCA: BPL must slash outage frequency 40%
Providence have increased more than 25 percent since 2017, now at 10.2 percent.” System losses represent both so-called technical and nontechnical losses of electricity generated by BPL when it is dispatched around its grid.
Technical losses refers to energy lost through BPL’s cables and transformers, while non-technical losses represent electricity that is consumed by customers but not billed due to metering and billing system inefficiencies plus fraud and theft. The URCA audit findings show that more than one-tenth of electricity produced by BPL is being lost from the grid before it reaches customers and/or is billed.
BPL, though, disputed some of the audit findings.
“In reference to Castalia’s statement in the draft report that ‘Service reliability is relatively poor, with relatively high system losses of 13 percent and low system reliability’.... BPL has pointed out that it should be noted that this figure includes both
technical and non-technical losses,” it added. “In response to the audit statement that ‘the T&D network is reaching maximum capacity: There is no N-1 redundancy in the summer peak should one substation or critical network component go down’, BPL has contended that this is not entirely true for all operations.
“BPL posited that this may be true in the Family Islands which are predominantly radial feeds but not true for New Providence T&D networks. There are challenges for a few transmission circuits during the summer peak, but not all of them.” Castalia “noted the response”. And, as for system losses, BPL moved to correct the 13 percent figure. It produced revised data showing system losses increased from a low of 8.06 percent in 2017-2018 to a peak of 11.74 percent in 2021-2022 before dropping down to 10.19 percent in 2022-2023. Castalia accepted those figures.
However, URCA said of the consultant’s
findings: “The audit found that although BPL schedules planned maintenance for the winter period to ensure adequate reserve margin for the summer peak, maintenance is mostly reactive rather than preventative. BPL often defers planned maintenance due to limited reserve capacity and inventory challenges.
“The availability factor in New Providence averages 66 percent, while it is slightly lower (61 percent) across the Family Islands. This is relatively low compared to other utilities. Lower availability factors may indicate more frequent breakdowns and the need for more repairs due to poor maintenance and operation protocols.
“BPL has installed automated generation control in New Providence and plans to implement an Enterprise Asset Management system, which will help monitor the condition of all network assets in real-time and direct preventive and corrective maintenance optimally.”
Maintenance issues were having a direct impact on the reliability of BPL’s energy supply. “Benchmarking
reliability indicators shows that BPL’s customers experience more frequent interruptions compared to other utilities, but interruptions do not last as long. This indicates that BPL responds to outages relatively well but could improve on preventing outages before they occur,” URCA said.
“The audit found that since 2021, reliability has improved but remains relatively poor. In 2023, the System Average Interruption Duration Index (SAIDI) was 593 minutes per customer, and the System Average Interruption Frequency Index (SAIFI) was 10.5 interruptions per customer.
“BPL will need to improve its performance significantly to reach the reliability targets proposed by URCA. BPL will have to reduce SAIDI and SAIFI in New Providence by almost 60 and 40 percent, respectively,” URCA continued.
“The audit reveals that BPL lacks a multi-year plan for infrastructure upgrades and investments, which makes it difficult to project
capital expenses accurately and develop a strategy to optimise asset utilisation. The lack of forward-looking planning makes risk management and planning reactive rather than preventative.
“BPL’s budgeting and planning processes are largely manual. Budgeting is done in Excel using information generated from AS400 software. While the software is functional to support budgeting and accounting, it needs upgrading, and manual data exports may be required to realign data.”
URCA also said close to one out of every ten BPL staff is due to retire over the next four years to 2027. “The audit found that BPL has no clear strategy to anticipate or plan to replace the loss of skills due to employee attrition in the medium to long-term. BPL conducts mostly reactive and shortterm analysis and planning of its workforce needs,” it added.
“The audit also found that BPL risks losing institutional knowledge and technical expertise due to unplanned exits and retirement, as
Act’s noble intent ‘taking us down the path to hell’
FROM PAGE A24
properties where the same institution is seeking to exercise its power-of-sale.
Arguing that “family members” needs to be better defined, given the extensive inter-locking family relationships in The Bahamas where “everybody is my cousin”, Mr Bowe also called for greater clarity over what is deemed to “a reasonable effort” by a deadbeat borrower to at least pay some of their monthly obligations.
The Homeowners Protection Act, which was passed into law in early 2017 during the final months of the Christie administration, has long generated concerns over so-called “unintended consequences” that have made already-skittish lenders even more reluctant to advance mortgage credit with the result that residential housing market activity is curtailed.
Explaining the origins of the latest reform push, Mr Bowe, who is also Fidelity Bank (Bahamas) chief executive, told Tribune Business: “The clearing banks years ago, when the Homeowners Protection Act was first enacted, and before it was enacted, had raised various challenges with the legislation.
“There was some dialogue between the clearing banks and the Ministry of Finance, and there were some matters agreed with the Ministry of Finance, but no amendments were made to the law. There were points discussed in 2016, and some were agreed and some not agreed. Because some were not agreed none got amended before or after the legislation was enacted.”
Now, Mr Pinder has “taken it on board”. Mr Bowe added: “The Attorney
General has agreed to establish a working group that does three things. Those points that have been agreed, the drafters amend them. For those points requiring policymaker decisions, for him to carry that back to Cabinet. Third, once the policymakers have taken a decision on a point, to write back so it’s put to bed....
“The result of the lack of clarity and lack of practical implementation ability is it created such a delay on the recovery process through power of sale, even if the financial institution wanted to lend a mortgage, they not only have to think about credit risk but also legislative risk. Legislation should not prohibit commerce.”
The Act inserts the courts into the mortgage contract, especially when it comes to the foreclosure and ‘power of sale’ process, leaving its provisions open to judicial interpretation. Instead, Mr Bowe argued that the terms of the mortgage contract should be left alone for both parties to perform their respective obligations.
“While the legislation is honourable, it may have been passed with good intent, but it is carrying us down the path to hell,” he told Tribune Business. Sir Franklyn Wilson and his predecessors as Clearing Banks Association chairman have also voiced similar concerns.
Outlining the impact in its just-released 2023 annual report, Fidelity Bank (Bahamas) wrote: “The significant inventory of slow-moving distressed properties, and the geographical location of The Bahamas on the hurricane belt and the consequent cost of premiums for insuring properties held as collateral for such and similar catastrophes represent
certain of the structural challenges confronting mortgage lending in The Bahamas.
“Additionally, legislation in The Bahamas that was enacted with the honourable intention of protecting home ownership has proven to be rife with practical implementation challenges and the unintended consequences of significantly delaying the normal recovery processes involving sale of collateral under the powers of sale granted in the mortgage deeds.
“These structural and legislative challenges, as exacerbated by the economic malaise caused by the global pandemic, has had the effect of significant contraction in mortgage loans reported by the commercial banking sector since December 31, 2019, and the consequent enhanced caution in underwriting by the commercial banking sector is not expected to see any reversal for the foreseeable future.”
Mr Bowe, meanwhile, told Tribune Business that The Bahamas “kind of put the cart before the horse” by enacting the Homeowners Protection Act without it being accompanied by a modern bankruptcy law framework. He pointed to Canada as an example of where there were protections for a delinquent borrower’s home, under certain conditions, but creditors could make claims on their other assets.
“The Government had honourable intent,” he reiterated, “but the overall and holistic approach requires modern bankruptcy legislation accompanied by homeowners protection, not homeowners protection unaccompanied by modern bankruptcy legislation. It’s
putting the cart before the horse.
“Part of legislating a framework for bankrupting individuals is to allow them to retain their home. Part of that is homeowner protection. You don’t have homeowner protection and then figure out how to recover outside that. It’s putting banks in a very tenuous situation. You may be willing to take credit risk, but am I going to take legislative risk?”
The Christie administration’s rationale for developing the Homeowners Protection Act was to make delinquent Bahamian mortgage borrowers more secure in their homes, with all the attendant social and economic benefits that will bring if they can restructure their loans.
However, it threatens to increase the costs, time and difficulty/uncertainty incurred by banks in repossessing mortgage collateral
almost 9 percent of staff will become eligible to retire between 2023 and 2027...
“Small, old, and relatively inefficient ADO units generate almost all electricity on Family Islands. The average age of generation units in the Family Islands is 23 years, more than double the average age of units in New Providence (ten years). Ensuring generation units remain operational 24/7 has been challenging in the Family Islands due to a lack of skills and capital and the overload of current staff,” URCA said.
“According to its licence, BPL must, to a reasonable extent, implement modern technological solutions to secure optimal efficiencies in its operations. Although BPL has made efforts to commission new, more efficient units, it does not fully meet these provisions of its licence, particularly in the Family Islands.”
- usually the homes and businesses subject to the original loan. With a higher risk now associated with mortgage lending as a result, the banks may both hike interest rates and refuse to grant new Bahamian loan applicants access to credit.
Besides impeding Bahamian dreams of home ownership, this could further depress the housing market and negatively impact industries that rely heavily upon it, especially the construction, real estate and legal sectors.
AML Foods ‘expands ambitions’ to target $300m sales by 2030
Road site by November this year as the next step in its growth plans.
“In our annual report we are writing, we think we will be above $300m by 2030,” Mr Watchorn told Tribune Business of total sales. “We’ve expanded our ambitions. We believe there are growth opportunities for us.
“We want to make sure we have an opportunity it aligns with the community, it aligns with the environment and it aligns with shareholder expectations. We believe there’s an opportunity for us, and our target now is that we want to be a $300m company by 2030.”
That would represent a $109m, or 57 percent, increase to the $191m topline generated for the 12 months to end-April 2024 in just six years. AML Foods has acquired sites in southern New Providence off Charles Saunders Highway, as well as at Faith Avenue in the Carmichael Road area, for future store expansion but Mr Watchorn said its first priority is Cost Right’s relocation.
“That will be November at the latest,” he confirmed. “We are a little ahead of schedule. We expect
Cost Right to come up here during the month of November. The team are running a little ahead of schedule.” Cost Right will occupy 55,000 square feet that was formerly used for Solomon’s SuperCentre, and will be immediately next door to the remodelled 25,000 square foot Solomon’s Old Trail outlet.
AML Foods is investing $22m in acquiring the 80,000 square feet that both its retail formats will occupy, along with the remodel and renovations.
Franklyn Butler, the BISXlisted group’s chairman, yesterday voiced opposite that the location next to Cable Bahamas’ headquarters will become a shopping “destination”.
Mr Watchorn, meanwhile, said Cost Right’s new home space compares favourably to the 30,000 square feet it currently occupies at Town Centre Mall. He added that the investment represented “a little bit of consolidation” for the Solomon’s brand, which will no longer employ the ‘big box’ SuperCentre format but instead focus on its two ‘Fresh Market’ outlets and the neighbourhood food store concept.
“When we looked at it, Solomon’s SuperCentre
NOTICE
RLE Gomes Ltd.
Incorporated under the International Business Companies Act, 2000 of the Commonwealth of The Bahamas. Registration number 211479 B (In Voluntary Liquidation)
Notice is hereby given that the above-named Company is in dissolution, commencing on the 30th day of July A.D. 2024. Articles of Dissolution have been duly registered by the Registrar. The Liquidator is Mr. Rodrigo De Mello Gomes, whose address is Alameda Anapurus 999, APT 131, Sao Paulo, SP, CEP: 04087-002, Brazil. Any Persons having a Claim against the above-named Company are required on or before the 29th day of August A.D. 2024 to send their names, addresses and particulars of their debts or claims to the Liquidator of the Company, or in default thereof they may be excluded from the benefit of any distribution made before such claim is proved.
Dated this 30th day of July A.D. 2024.
RODRIGO DE MELLO GOMES LIQUIDATOR
and Cost Right, particularly in Nassau, having them so close to each other, a mile-and-a-half apart and selling the same product, we felt it was not the best use of space,” he explained of the remodel. “The team has done an excellent job of staying best in class with what we’re trying to do and use space more efficiently.
“It’s about creating efficiencies for our team, it’s about creating the right experience for our customers, and we’ve been able to do that with a lesser footprint which means a smaller capital investment upfront.” The renovated Old Trail maximises floor use while also being spacious, with the check-out aisles in particular much wider than those found in a traditional grocery store.
While smaller than the 38,000 square foot Solomon’s Yamacraw, Mr Watchorn pointed to similarities between the upgraded location and the group’s downtown Freeport location. “This is the model for future expansion that we intend to replicate in several more areas,” he told this newspaper.
But, while AML Foods has “begun planning” for other land it owns, its president and chief executive reiterated: “Our next project is to get Cost Right up and running and then move on to the next opportunity we have. It is our goal to continue to grow. We have a road map of opportunities that we feel are right for the community, right for us, right for our associates and right for our shareholders.
“We’re quite structured in what we’re doing in terms of growth. The team have done a tremendous amount of work looking at processes, systems and procedures to make sure the system can be executed by the majority [of staff]. We are aligning ourselves with partners who are growth minded.
“We have good opportunities for our team and they want to be part of it. We have more and more people putting up their hands for promotion. We’ve set ourselves a target, I think it’s 85 percent, of all promotions to be internal. You cannot just grow buildings; you have to grow people.”
Describing this as being “among the key pillars of growth”, Mr Watchorn added: “We have a mission, and we are being very structured and deliberate about what we’re doing - whether that’s long-term development of people, long-term management of debt, or aligning with partners.
UPGRADED DIGITAL ASSETS LAW IS NOW IMPLEMENTED
installing solar panels at the Old Trail Road site alone. And Mr Watchorn confirmed a new roof has also been laid, and told Tribune Business: “We have solar panels on the roof to take us 80 percent off the grid in the day time. We have to make sure we minimise our footprint and energy costs.
“Shortly we will have every roof in New Providence solarised. We’ve been doing this in several stages. It is a $2m investment to complete solar for all of our buildings in New Providence. It’s just about complete. We have one more place where it has already begun. It’s happening at the same time. Eventually we’ll be 70-80 percent off the grid during the day. Any new location will be solarised from the beginning.”
Mr Watchorn said the group’s overall sales were “a little bit soft” due to the Solomon’s Old Trail renovations, which had been underway since January.
“We expect with the reopening of the store to see a lift in sales,” he added.
“We’ve had a period of deflated sales with this store
“We have a mission we believe in, and have a mission that we believe is good for our consumers. We feel Bahamian consumers should have a good shopping experience, and we’re very intent and deliberate about what we’re doing.
“AML is bullish on what we are seeing from our industry. We are making more and more of our decisions data-driven. We are very deliberate about what we are doing as we have a plan, and are very deliberate about executing the plan.”
Richard Jones, AML Foods vice-president of facilities, said the group had invested $757,000 in
UPGRADED legislation to regulate the digital assets industry took legal effect yesterday, the Securities Commission confirmed. It said the Digital Assets and Registered Exchanges Act 2024 has now become law after reforms that built on the foundation left by the inaugural Act in 2020. The regulator added that it “took a proactive approach with DARE 2024, ensuring its alignment with current international best practices and the recommendations of standard-setting bodies,
“We are seeing a lot of improvement in our shrink experience. We put a lot of work into that. This time last year shrinkage was becoming a big challenge for us, as it had become a challenge for a lot of people in our industry. We have reacted to that, made changes and are seeing much better shrinkage than we were 12 months ago.
“We reacted to that, put a big focus on that and that’s making a big difference to our results. It really impacted our numbers for a couple of quarters. We are seeing a reduction in shrinkage and that’s hoping to drive improved results as well.”
including the International Organisation of Securities Commissions’ standards for regulators regarding crypto and digital assets, and the Financial Action Task Force recommendations”.
The “key highlights of DARE 2024” include its expanded scope, enhanced digital asset exchange requirements, robust custody framework, staking framework, comprehensive stablecoin framework and digital asset issuers.
LINEA LTD.
Incorporated under the International Business Companies Act, 2000 of the Commonwealth of The Bahamas. Registration number 207583 B (In Voluntary Liquidation)
Notice is hereby given that the above-named Company is in dissolution, commencing on the 29th day of July A.D. 2024. Articles of Dissolution have been duly registered by the Registrar. The Liquidator is Mr. Julio Cesar De Araujo Nogueira, whose address is SQN 112 Bloco D Apt: 404, CEP: 70762-040, Brasilia, Brazil. Any Persons having a Claim against the above-named Company are required on or before the 28th day of August A.D. 2024 to send their names, addresses and particulars of their debts or claims to the Liquidator of the Company, or in default thereof they may be excluded from the benefit of any distribution made before such claim is proved.
Dated this 29th day of July A.D. 2024. JULIO CESAR DE ARAUJO NOGUEIRA LIQUIDATOR
NOTICE
MOLE BEACH CAPITAL LTD.
Incorporated under the International Business Companies Act, 2000 of the Commonwealth of The Bahamas. Registration number 207456 B (In Voluntary Liquidation)
Notice is hereby given that the above-named Company is in dissolution, commencing on the 30th day of July A.D. 2024. Articles of Dissolution have been duly registered by the Registrar. The Liquidator is Mr. Claubert Jose Maag, whose address is Rua Rui Barbosa, 650, Bairro Agronômica, Apto 902A, CEP: 88025-301, Florianópolis, Brazil. Any Persons having a Claim against the above-named Company are required on or before the 29th day of August A.D. 2024 to send their names, addresses and particulars of their debts or claims to the Liquidator of the Company, or in default thereof they may be excluded from the benefit of any distribution made before such claim is proved.
Dated this 30th day of July A.D. 2024. CLAUBERT JOSE MAAG LIQUIDATOR NOTICE
Big Tech weakness holds back Wall Street even as most stocks rise
By STAN CHOE AP Business Writer
MORE drops for Big Tech stocks dragged on Wall Street Tuesday, overshadowing gains for much of the U.S. stock market.
The S&P 500 slipped 0.5%, even though two out of every three stocks within the index rose. The Dow Jones Industrial Average rose 203 points, or 0.5%, and the Nasdaq composite sank 1.3%.
PayPal rose 8.6% and helped lead the market's gainers after it topped analysts' expectations for profit during the spring. It also raised its forecast for profit over the full year.
JetBlue Airways climbed 12.3% after reporting a profit for the spring, when analysts were expecting to see a loss. The airline also outlined ways it hopes to improve on-time performance and attract customers.
But a 0.9% slide for Microsoft nevertheless helped drag the S&P 500 lower as investors waited for its latest profit report, which arrived after trading finished for the day. Microsoft's stock fell further in after-hours trading. Most of the other stocks in the group that's come to be known as the "Magnificent Seven" also fell Tuesday, including a 7% tumble for Nvidia. This handful of Big Tech stocks drove the S&P 500 to dozens of records this year, in part on investors' frenzy around artificial intelligence technology. But they ran out of momentum this month amid criticism they had grown too expensive and expectations had run too high.
Last week, investors found profit reports from Tesla and Alphabet underwhelming, which raised concerns that other "Magnificent Seven" stocks could also fail to impress.
Amazon, Apple and Meta Platforms will report their latest profit results in coming days. Their performance carries extra weight on the S&P 500 because they're among the largest by value.
Helpfully for the market, other stocks have been rising up to cushion some of Big Tech's recent softness, including smaller stocks and companies whose profits are closely tied to the strength of the economy. They rallied on hopes that inflation is slowing enough to get the Federal Reserve to soon begin cutting interest rates.
The Russell 2000 index of smaller stocks added 0.3% Tuesday to stretch its market-leading gain for the month to 9.5%.
Many along Wall Street expect this rotation from Big Tech to smaller stocks to continue, but more cautious voices are still urging skepticism.
"In our view, the recent rally is likely unsustainable as the fundamental support is lacking," according to Austin Pickle, investment strategy analyst at Wells Fargo Investment Institute, who pointed to how more than 40% of small-cap companies aren't making any profits, among other challenges.
Also helping to weigh on Wall Street Tuesday was Merck, which fell 9.8% despite reporting stronger results for the last quarter than expected. It gave a forecast for profit this year that fell short of analysts' expectations, partly because of costs related to its buyout of Eyebiotech.
Procter & Gamble slid 4.8% after beating forecasts for profit in the latest quarter but falling short on revenue. It was hurt by the effects of shifting foreign exchange rates on its international sales, and it expects that to remain a
challenge in its upcoming fiscal year. All told, the S&P 500 fell 27.10 points to 5,436.44. The Dow added 203.40 to 40,743.33, and the Nasdaq composite fell 222.78 to 17,147.42.
No one expects the Fed to cut interest rates this week, when it announces its decision on Wednesday. But the widespread expectation is that it will do so at its next meeting in September.
Expectations for a soonto-be easier Fed have sent yields tumbling in the bond market, and they eased further Tuesday. The yield on the 10-year Treasury fell to 4.14% from 4.17% late Monday and from 4.70% in April. Yields got a brief bump in the morning after a couple reports on the economy came in stronger than expected. One showed U.S. employers were advertising slightly more job openings at the end of June than economists expected.
That's a good signal for workers, but too much strength could put upward pressure on inflation.
A second report, meanwhile, said confidence among U.S. consumers is improving by more than economists expected. There, too, the hope is for a "Goldilocks" type of reading that's neither so hot that it raises fears about reaccelerating inflation nor so cold that it warns of a possible recession.
In stock markets abroad, indexes were mixed across Asia and Europe ahead of decisions by central banks there that could shake things up.
Japan's Nikkei 225 added 0.1% ahead of a meeting by the Bank of Japan, where the expectation is for an increase in interest rates.
The FTSE 100 in London slipped 0.2% ahead of a decision by the Bank of England that could feature a cut in rates.
