The Export -Import (Ex-Im) Bank has dropped its lending rates to between 10 to 11.5 per cent for Jamaican dollar loans and 7.5 to nine per cent for US dollars loans, representing up to a two percentage point drop in loan rates.
These new rates become effective October 1, 2010. 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. Ex-Im’s approved financial intermediaries include major commercial banks, merchant banks and money market brokers across the island.
There is also a special window now in place for Small and Medium Enterprises (SME) to access loans for renewable energy projects at 9.75 per cent for Jamaica dollar loans, and which start at 5.63 per cent for US dollar loans.
Ex-Im, in realizing the challenges to grow and develop businesses in the productive sector, sees it necessary to adjust its rates based on the needs of the stakeholders in order to help them compete in the global marketplace.
Manager, Trade Financing and Risk Management, Valerie Crawford, says the reduction of the rates is part of the Bank’s mandate to enhance its clients’ capacity by creating easier access to loan facilities and is in keeping with government’s objective to reduce interest rates to the productive sector.
“We are keen on working directly with established and potential clients to ultimately help them to grow and develop their businesses,” she said. She added that with competition not just in Jamaica and the Caribbean, companies needed a competitive advantage and to have access to new and emerging markets.
For the last 12 years Ex-Im Bank has kept the rate consistently at 12 per cent in keeping with the customers’ needs. In comparison to the average 30 per cent lending at that time, Ex-Im Bank has consistently responded positively to the demands of the productive sector.
In the meantime, the Bank is reporting a pool of $1.1 billion of new money, with an ambitious loan utilization target of $6.6 billion up to year end March 2011. This represents an increase of approximately 27 per cent over the $5.2 billion achieved at year end March 2009.