JIS News

Story Highlights

  • The Jamaica Mortgage Bank (JMB) has launched a technical support services product that will assist financial institutions to make more informed decisions about construction financing.
  • JMB’s Director of Business Operations, Hecton Hemans, said that after assessing the number of default loans on its books, the bank decided to set up a technical support services unit headed by someone with qualifications in construction engineering and quantity surveying.
  • The Director explained that JMB decided to leverage the experience and skills developed over time and offer that to financial institutions by partnering to reduce the risks associated with construction financing.

The Jamaica Mortgage Bank (JMB) has launched a technical support services product that will assist financial institutions to make more informed decisions about construction financing.

Speaking at the product launch recently, in Kingston, JMB’s Director of Business Operations, Hecton Hemans, said that after assessing the number of default loans on its books, the bank decided to set up a technical support services unit headed by someone with qualifications in construction engineering and quantity surveying.

“We were able to turn things around by using the technical analysis as the sub-structure of the loan assessment for borrowers and build the financial assessment or the superstructure on top of that. That helped to detect the risks of construction early, where there were flaws, such as costing and planning approval,” he explained.

“That way you are able to put mitigating steps in place to manage the risks,” the Director added.

Mr. Hemans said that most players in the market have an emphasis on the financial assessment, and bemoaned the fact that many financial institutions expect the loans officer to be “all things to all men,” while ignoring the fact that construction financing requires highly specialized skills. Otherwise, it can be very expensive, he noted.

The Director explained that JMB decided to leverage the experience and skills developed over time and offer that to financial institutions by partnering to reduce the risks associated with construction financing.

“We share the risk and together implement mitigating strategies to better control them and as a result of that, we think that you’ll be able to get better returns on your investment in the industry, because your success rate of projects will increase,” he advised.

Mr. Hemans explained that the technical analysis would help to determine the amount, the term and the pricing of the loan and that through monitoring there can be early detection, correction of errors and steps to mitigate risks.

There are four types of projects that will benefit from the JMB’s product – serviced lots, residential units, commercial complexes and mixed purpose facilities – which are imminent under the new development orders from the National Environment and Planning Agency (NEPA).