In the last five months, the stock price of Cayman National Corporation (CNC) has risen 59 percent – a return that exceeds most aggressive hedge funds. Although the CEO, Stuart Dack said it was too early to comment on its profitability, it already looks like this year will be another record year for the bank, which will in turn continue to push the stock price up.

“I think the stock price reflects investors’ confidence and they see the opportunities and the uniqueness of the business that comes from being the only financial group headquartered in the Cayman Islands,” said Mr Dack.

“I think the way we recovered from the setbacks after Hurricane Ivan just underpins investor confidence in the whole situation.”

When Cayman Net News interviewed Mr Dack in December 2005, the CNC stock price was at a low of $2.20 per share. At that time, Mr Dack stated the stock was significantly undervalued. This month CNC stock price stands at to $3.50 per share, which is 59 percent growth in five months.

There have been questions about why it took five months for the stock price to get to this level. One reason may be the bulk of its 1500 shareholders are Caymanians, and they were busy rebuilding their businesses and homes and just came up for air to deal with other investments.

Mr Dack explained that CNC is expanding both domestically and internationally. On the domestic front Cayman National Bank is opening a branch in Savannah and Camana Bay and will be installing an ATM at North Side to cater to customers in the East End District.

This strategy is part of its commitment to be the bank of the Cayman Islands.

Internationally, CNC is growing its fund administration for the hedge fund market and recently opened another office in the Island of Man.

President of International Financial Services, Ian Phillips, said this area has experienced a 50 percent growth and continues to grow.

“Cayman is known as a major hedge fund jurisdiction,” said Mr Phillips. “Fund administrators like UBS and Fortis are already established with administration of large funds. We think there is a demand to service the start-up and medium to small size funds.”

He explained that CNC is also looking to capitalise on the growing hedge fund markets in Asia and the Middle East, with Dubai and Singapore being considered for satellite offices. They may also try to move further into the Latin American market and open another office in a gateway city. Although Mr Phillips would not specify which cities the bank is considering, Panama City is a likely choice.

Another development in the works is that CNC stock will actually be traded on the Cayman Islands Stock Exchange (CSX), this is expected to start in the next two months, marking another milestone for CNC, which will increase its liquidity.

It is also in the midst of rebranding its corporate logo. Mr Dack stated that it conducted research in 2005 to show how its brand identity was doing. The research revealed the CNC logo had a strong positive recognition, but it was somewhat outdated and no longer accurately reflected the financial group’s image.

“The brandmark was popular, but there was a gap between how it was viewed and the reality of our position. As a result, our Board of Directors established that our 14-year old brand needed a makeover in order to align our image with our reality,” he added.

The new corporate logo has intensified its colours and modernized the stars and striped of the shield noted Mr Dack. The new corporate logo is being incorporated throughout its offices, bank branches and ATMs throughout the Islands.

shurna@caymannetnews.com