GREAT BAY:--– The commissioner responsible for economic affairs, Frans Richardson, recently continued his series of information gathering sessions with major stakeholders, by meeting with representatives of the banking sector.
Representing the Windward Islands Bank was Managing Director, Mr. Jan Beaujon, while the RBTT bank was represented by Mr. Wayne Kowlessar, President and Country Head & Ms. Cheryl Lake-Valies, Country Operating Officer. First Caribbean Bank was represented by Alphons Gumbs, Credit Manager.
Additionally present during the discussions were Mr. Romeo Pantophlet and Mr. Fernando William of the commissioner’s office along with Ms. Lucy Gibbes, Department Head and Ms. Hickinson of the department of economic policy and research.
In considering the current economic developments and future prospects, there is a general consensus, that overall the market has declined due to a global economic downturn.
As main indicators to reach that conclusion were, among others:
• Slowdown of construction projects as a consequence of a downturn in pre-sales of some major projects.
• Reduction of employment in construction (and trade sectors) and subsequent reduction in consumer spending.
• An average 30 to 35 percent drop in credit card sales.
• Drop in loan demand (particularly in the commercial sector)
• More small businesses requesting an extension in overdraft facilities, in order to survive.
• Higher delinquencies on consumer loans as compared to 1 ½ year ago.
• Increase in late loan payments
While the banking sector has reportedly not recorded a significant change in foreclosure trends, Commissioner Frans Richardson was told that banks are working with clients on an individual basis to prevent foreclosures seen as an absolute last resort.
Home mortgage demand has meanwhile remained stable with private/residential buildings still being constructed.
Another development is that higher end/modern rental spaces are not being rented.
With regards to Interest rates, these have dropped within the last four years from 13% to as low as 7% at present.
Commissioner Richardson was encouraged to hear that the banking sector has taken measures or is in the process of doing so, to mitigate the current impact.
Among the initiatives is the incorporating of special packages (in the commercial sector) by the banking sector, in order to stimulate economic activity.
The banking sectors have made a number of tangible recommendations for short-term & structural solutions in collaboration with government.
Those are at present being reviewed.
