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Six banks in BVI answer Premier’s call to offer moratoriums to clients affected by COVID-19

At least six banks across the British Virgin Islands have agreed to offer their clients moratoriums for up to six months to assist in easing their financial worries during the COVID-19 crisis.

These agreements came days after Premier Andrew Fahie had pleaded with banks in the territory to suspend payments owed by customers experiencing hardships because of the pandemic.

The banks who have agreed to offer moratoriums include FirstBank, Banco Popular, National Bank of the Virgin Islands, VP Bank, Scotiabank, and CIBC First Caribbean International Bank.

Those financial institutions all confirmed that they will be offering moratoriums on various products and services at a recent e-Forum held by Money Matters BVI last week.

Firstbank VI

Senior Vice President at FirstBank VI Angel Dawson commenced the session by firstly defining what a moratorium entailed.

“A moratorium indicates that through a process, there can actually be a delay with the payments for a loan, generally for a defined purpose,” Dawson said. “In this particular case, we know that many of our businesses and individual consumers are being affected by the global pandemic that we’re experiencing, through no fault of their own, they’ve been asked to either shut their business or not report to work,” he added.

Dawson also stated that FirstBank will offer moratoriums on all their lending products, and assured clients that the interest rates on their agreed loans will not be increased.

“We want to make it clear that we do not increase the interest rate during the period of the moratorium or ever for that matter. The interest rate is the rate that was approved and agreed to when the loan was closed initially,” Dawson stated.

National Bank VI

The National Bank of the Virgin Islands said they are pleased to be providing residents moratoriums for both their retail and commercial loans.

The bank said the moratoriums will be for customers who have been impacted financially by COVID-19 and will defer payments for up to three months in the first instance.

“On a request-only basis, during the three-month moratorium period, loan customers with fixed blended payments will be required to pay nothing. However, interest will continue to accumulate during this moratorium period and will be due in the future, subject to payment ability,” National Bank CEO Joy Penn explained

She added: “At the end of the moratorium period, your normal monthly payments would resume. A lump-sum payment will not be demanded upfront, as this would be deemed burdensome to most persons.”

Banco

Vice President and Commercial Credit and Relationship Manager at Banco Popular, Darren Vanterpool also said that his bank will be offering moratoriums across all their lending products, both on the personal and commercial space.

He said for mortgages, the moratorium being offered will be on both principal and interest rates for up to three months in the first instance, and for credit card owners, they will have to request for a moratorium.

Deferral and not forgiveness of debt

Vanterpool also clarified queries raised by clients as to whether the moratorium would be forgiveness of debt repayments or a deferral.

He said that it is not a forgiveness of the debt, but an accommodation to allow individuals or businesses to not have to make that debt obligation payment on a given month.

“The allowance is usually for when there’s a shortage in cash, whether it is a cash flow problem in the business or if there’s an income problem in the case of personal income,” Vanterpool stated.

“So yes the accommodation is sometimes very necessary because there are instances in which the payment just cannot be made, so the accommodation is to allow persons to put a financial plan into place so that when the agreed moratorium has expired, then they would be in a position to resume payments,” he further explained.

Scotiabank

Scotiabank, in the meantime, said they have created what they term a Customer Assistance Programme which will seek to give help to all their categories of customers.

“The mortgage moratorium that we are offering, customers are required to opt into the programme, in that it is not automatic. There is a waiver, an offer to waive principal and interest payment for up to three months in the first instance, with the option for going up to six months,” Branch Manager Marvin Scott stated.

He also said that depending on the maturity date of a loan, Scotiabank will amortize the accumulated interest accordingly.

CIBC

CIBC First Caribbean International Bank will be offering payment moratoriums for up to six months to all their retail and commercial clients.

CIBC’s Retail Manager Fabian Devonish explained that while some of the moratoriums will be automatic for some services, customers will have to request to enable the option on other services.

“Clients are given the option to opt into the payment waiver, it is not automatic. They can reach out to through our internet banking platform and request it, or they can reach out to their individual lenders or myself as branch Manager and advise us that they are interested in taking the payment moratorium,” Devonish stated.

“We’ve automatically marked forward our credit cards to a next due payment date of June 2020, and only if the client wants to make a payment do, they have to,” he added.

VP Bank

Meanwhile, VP Bank said they will be offering moratoriums to a certain extent where they are deferring the principal portion of the advertised payment that a client is expected to make.

“At this present moment, we are not taking a blanket approach to our clientele where we are offering moratorium to everyone. What we are doing is asking persons to communicate with us in order to proceed with the application process,” stated Client Advisor at VP Bank, Sasha Creque.

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13 Comments

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  1. Fine but says:

    Open the banks. Otherwise people can’t get pay, can’t pay rent.

  2. TruDat! says:

    I don’t generally like banks but credit where credit is due – this is a significant step in the right direction.

    Like 11
    Dislike 1
  3. Diaspora says:

    These are difficult times for many borrowers so the offer by many banks to defer interest and principal payment is a comforting respite for many borrowers. Nonetheless, it does not appear as neither the principal nor interest for the 3-6 months is going to be forgiven. The question is if at the end of 3-6 months will a balloon payment be required? If so this will be a burden on borrowers. How will banks addressed the deferred payments due and the regularly resumed payment?

    Moreover, will government be providing a rent/mortgage allocation in an assistance package? The economy is currently in a recession and could likely be thrusted into a depression. What is the plan if after the deferred period borrowers are still having having problems paying their mortgages?

    • @ Diaspora says:

      You will lose your years of sacrifce to the next highest bidder, period!

      An institution, a financial one, is an inanimate organism, none human one. It has no heart, conscience or felixibility potential.

      The financial world is governed by profit margins, not moral convictions.

      Like 13
      Dislike 2
      • Hello says:

        “You will lose your years of sacrifce to the next highest bidder, period!“ …. yea, that’s what a lot of you waiting for… Never, Never!!!! I repeat, NEVER!!!

  4. Kimono says:

    Thank you banks for your efforts. However permit me to say that this is not good enough. You are just extending my loan. At the end of the day I still have to pay you all that I presently owe you and in some instances more interest for these months of moratorium. Why not just cancel all payments for April and May 2020 without more…?

    Like 3
    Dislike 3
  5. W.E Man says:

    A significant part of my mortgage payment Is an escrow payment to pay my home insurance, will this be deferred as well?

    • Escrow payment required says:

      No, banks cannot defer escrow payments, such as insurance. That is due when the payment resumes in 3 or 6 months.

  6. I wonder says:

    Here is the real question? So the landlord get a break from the bank no matter the terms will they pass the break to the tenants or are expect to pay rent? If you are going to collect your rent why not pay the bank? It be should be wrong to get the break but then be equally unforgiven to tenants. My two cents

    Like 3
    Dislike 2
    • Roll eye says:

      Not our business.. Pay your rent

      Like 3
      Dislike 2
    • Lol says:

      Only if the tenant agrees to pay the amount added on at the end of the mortgage – including interest.

      Harsh but why should the landlord have to carry the van on what is only a deferral and in fact end up paying more mortgage.

  7. Tjk says:

    This is good new and i applaud the premier and also the banks

  8. The Reaper says:

    We still have to pay that Rent U know. We not out of it, That money do not belong too We.It belong to The Landlords then too the banks….Father say..Save For The Rainy Days ,Now i know what that Mean. It’s hard ,,but this is life. These are some Serious Times

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