The Jamaica Mortgage Bank (JMB) is in discussions with the National Housing Trust (NHT) and the Jamaica National Building Society (JNBS), to obtain funding to complete projects in the 2006/07 financial year.
Speaking with JIS News recently, Milverton Reynolds, Acting Managing Director of the JMB, informed that the bank was currently projecting total commitments of $3.7 billion for the financing of some 2,910 housing units in the next financial year, and additional funding had to be accessed. Securing the additional funds would allow the bank to not only supplement its financing programme, but also be able to again lower its interest rates, he said.”We have approached the NHT for $500 million of funding for our construction financing programme. These discussions are at an advanced stage and when concluded, if we are successful, it means that we will again be able to review our interest rates with a view to reducing them even further,” Mr. Reynolds told JIS News. Continuing, the Managing Director reiterated the Bank’s commitment to pass on any gains to the purchasing public.
The JMB last December reduced its interest rate by three percentage points, from 21 to 18 per cent. This reduction was made possible by the savings realised with the fall in rates paid on treasury bills, which in turn had reduced the JMB’s cost of funds. In addition, the JMB’s increased investment in the construction industry yielded high returns and has afforded the institution the opportunity to pass on some of the savings to home buyers.
The agreement between the JMB and the NHT, if successfully completed, will bring to $1.5 billion the amount of funds the JMB has been able to secure for its construction financing portfolio. “We are also in the process of securing an additional $500 million from Jamaica National, and it is important to note that the funding that we are finalising with Jamaica National does not require a Government guarantee,” Mr. Reynolds stressed.
In late November 2005, the JMB secured a government guarantee for $500 million in shelter bonds that were taken up by Victoria Mutual Building Society (VMBS). The funds obtained from these transactions will be used for the financing of 32 active housing projects in St. Ann, Hanover, Kingston and St. Andrew, St. James, St. Thomas and St. Catherine.