TDC says SIDF financing assisted FINCO in growing its loan portfolio
Basseterre, St. Kitts, August 26th 2013 (CUOPM) – The St. Kitts-Nevis-Anguilla Trading and Development Company (TDC) said the injection of financing by the Sugar Industry Diversification Foundation (SIDF) into one of its subsidiaries – FINCO – the St. Kitts-Nevis Finance Company – has resulted in the growth of its loan portfolio.
TDC’s annual report for 2012 said FINCO’s performance was good, though slightly lower results than the prior year.
“Its (FINCO) loan portfolio grew but mainly in the lower earning home mortgage category which was facilitated largely by the company’s participation in the FREESH program, an initiative of the Sugar Industry Diversification Foundation (SIDF).
FREESH is the Fund for the Realization of Economic Empowerment through Subsidized Housing and is aimed at expanding activity in the construction sector and, by extension, economic activity in the Federation.
To achieve this, the SIDF has partnered with the Development Bank of St Kitts and Nevis (DBSKN), the St. Kitts and Nevis Finance Company (FINCO), the St. Kitts Co-operative Credit Union (SKCCU) and the Bank of Nevis to provide residential mortgages of up to $500,000 at a fixed, low interest rate of 5% per annum, via a Fund for the Realization of Economic Empowerment through Subsidized Housing (FREESH).
The SIDF has allocated an amount EC$10,000,000 to the FREESH. The use of this Fund will stimulate the housing sector by encouraging citizens of St. Kitts and Nevis, primarily those in the lower to middle income bracket, to invest in new residential housing; generate employment opportunities; improve access to housing; and enhance the quality of the housing stock.
The SIDF has also provided an additional sum of EC$1,000,000 under an Equity Assistance Fund (EAF), to provide equity assistance for mortgages that qualify for funding under the FREESH. The EAF would help to remove the barrier to accessing residential mortgages, particularly for those applicants who may have difficulty in making the down payment.
The original terms of the FREESH enabled successful applicants to secure residential mortgages of up to $400,000 at an interest of 6.0% per annum. However, the initiative was revised to be more attractive to prospective homeowners.