Trinidad and Tobago's local banking sector has given the thumbs up to the Patrick Manning administration's decision to come to the rescue of CL Financial.

In a statement issued on the weekend, the Bankers' Association of Trinidad and Tobago (BATT) said its members backed the government's decision to bail out the regional conglomerate from serious financial difficulties.

"The Bankers Association of Trinidad and Tobago fully supports the robust intervention by the government and the Central Bank of Trinidad and Tobago in supporting CL Financial Group subsidiaries Colonial Life Insurance Company (CLICO), and CLICO Investment Bank through their current liquidity crisis," the statement read. According to BATT, the move by the central bank was a positive development for this oil-rich-twin island nation and was necessary to bring CLICO, the largest insurer in Trinidad and Tobago, back to a healthy financial position and thus preventing policy-holders and depositors from suffering.

Under a memorandum of understanding signed Friday by the Trinidad and Tobago government, the Central Bank and CL Financial, the government will provide funding to the company in exchange for collateral and an equity interest in the CLICO.

CL Financial controls over US$100 billion of assets in at least 28 companies throughout the world.