There has been an upward spike in its delinquency rate of the Bahamas Mortgage Corporation (BMC) over the years.
According to its former chairman, Dr. Duane Sands, who spewed numbers in the House of Assembly yesterday, 42 per cent of the loans were delinquent.
“By 2010, the BMC had a total of 3,119 loans on its portfolio, for a total book value of just under 180 million dollars,” he said.
“When I say delinquent, meaning more than 90 days, this was 2010, by 2017 the delinquency rate was 42 percent.”
Housing Minister, Romauld Ferreira, in his address, also gave insight into why the BMC is in the financial state it is in today.
The Minister cited cases of clients who continue to owe one of the country’s major lending agencies.
“A client is granted a mortgage in May 2003, for $78,837.00, the client is passed due $76,965.22; foreclosure proceedings commenced on April 2012 and a vacate order was granted in December 2015.
“The customer was given four months to vacate in 2015 and additional time and refused to pay anything toward the mortgage.
“This is a small sample, but they all read the same, and it speaks of the reticence of some borrowers who refuse to pay their mortgage.”
The Minister stressed that the corporation must do what needs to be done for its continued survival.
“I’d like to remind the public that the BMC has a $4.2 million bond interest payment that they must service in order to meet their obligations.
“They must adhere to the ten financial commandments that deal with all scenarios that will prevent them from achieving their goals.
“Mr. Michael Barry once said that one of the risks for anyone in the lending business is that being conservative can harm your competitiveness, therefore if the BMC is to survive, it must deal with its bad loans and bad mortgages,” said the MP.
Both ministers were contributing to debate on a resolution for the BMC to obtain four parcels of land on East Hill Street for the sum of $10 million.
On the site sits a 200-year-old building, the former home of the Ministry of Foreign Affairs, which is now being extensively refurbished.
“The management of BMC began searching for better accommodations to house their services,” Ferreira said.
“In 2016, the management expressed an interest in acquiring the historic building on East Hill Street formerly known as the Ministry of Foreign Affairs building, as its new home and submitted a request to the ministry of the environment and housing.
“Cabinet then approved the building to be acquired and housed by the BMC at its 12th meeting in 2017,” he said.
“Soon thereafter, a resolution was prepared and the treasurer was authorized to sell the building on East Hill Street to the Bahamas Mortgage Corporation.”
The renovations are being entirely funded by the Bahamas Mortgage Corporation.
