As new owners take control of the National Commercial Bank (NCB), the current management can only presume that the new operators will continue Governmentâs policy programmes such as the â100 percent mortgageâ and âstudent loans for the disadvantagedâ.{{more}}
âI would presume,â Chief Executive Officer at NCB, Andre Iton, responded to a question posed to him at a press conference on Tuesday afternoon, as SEARCHLIGHT sought to get clarity on the future of programmes which have so far benefitted police officers, teachers, nurses, and several underprivileged students who lack the security needed to obtain loans to pursue their studies.
âLet me speak to the mortgage situation: Mortgages have been a very good performing portion of the bankâs portfolio historically, and I will see no reason why a new [company] in assessing the performance of the various segments of the portfolio will shift significantly from what obtained in the past.
âThe student loan situation is a slightly different situation. Student loans, as you would recognize by their very nature, are long term in nature, because students get three or four years to go to study and they have a longer pay back of 15, 16, years on average,â said Iton.
âIt will be imprudent of a financial institution to have too much of its activity fixed at that end of the portfolio, particularly where the stream of repayments are not confirmed,â said Iton, outlining that with this type of loan, the bank does not know the personâs ability to repay, because a lot of the loanâs determination is based on conjecture.
âThose are the kinds of considerations that will have to take place in a more objective fashion when private sector owners are on board as opposed to when there is a situation when the owner has social policy considerations uppermost in their minds,â said Iton.
âOn the second one, one can expect that there will be some modification of the programme,â Iton said.
In the case of the mortgages, Iton said that he doubted that there would be any changes to what presently exists.(HN)
News
October 15, 2010
Iton: Mortgages have performed well historically at the NCB