EXIM cuts lending rate to exporters
Published:Sunday | September 12, 2010 | 12:00 AM
Come October 1, the EXIM Bank will lower its lending rates to between 10 and 11.5 per cent for Jamaican dollar loans, and 7.5 to 9.0 per cent for US dollar loans.
This represents up to a two percentage point drop in loan rates.
According to a release from the bank, which only lends to the productive sector, interest rates on loans accessed through the bank's approved financial intermediaries have also dropped by one percentage point to 11 per cent per annum.
EXIM's approved financial intermediaries include major commercial banks, merchant banks, and money-market brokers across the island.
"This rate reduction is in line with the Government's objective of reducing interest rates to the productive sector," said Valerie Crawford, manager of trade financing and risk management.
Crawford was making reference to the new operating environment following the Jamaica Debt Exchange, which reduced the interest earned on Government of Jamaica securities by more than six points on average to 12 per cent.
The EXIM Bank also announced a special loan window for SME energy loans involving renewable energy projects, through which credit is available at 9.75 per cent interest for Jamaica dollar loans, and a starting price of 5.63 per cent for US dollar loans.
Crawford said the reduction of the rates was in keeping with the bank's mandate to enhance its clients' capacity by creating easier access to loan facilities.
growth and development
"We are keen on working directly with established and potential clients to ultimately help them to grow and develop their businesses," she said, pointing out that Jamaica's competition extended beyond the Caribbean to other countries, and that local companies needed comparative advantage to make inroads into new and emerging markets.
EXIM is also reporting a pool of J$1.1 billion of new money, with a utilisation target of J$6.6 billion up to March 2011; an approximate 27 per cent increase over the J$5.2 billion achieved at year-end March 2009.
EXIM said its 12 per cent interest rate on JMD credit was kept at that consistent level for 12 years, even when others were lending at rates averaging 30 per cent.