Acting Prime Minister Reginald Austrie is commending the Agricultural Industrial Development (AID) Bank for its effort at combating the global financial crisis.
He told institution’s 17th annual general meeting at Fort Young Hotel this morning that while the global credit crunch has affected several financial organizations, AID Bank was able to survive it.
“The recent impact of the global challenges on financial institutions is no secret to any one of us. The global impact has been so severe, for those of us who survived it, our efforts are commendable. Today the AID Bank has showed that you have not only survived but done reasonable well in the circumstances,” he said.
He said the Bank’s net profit has increased by 48.7% over that which was achieved in 2008; the return of assets of 0.93% compared with 0.63% in 2008 and the non-performing loans being reduced to 18.7% from 20 % in 2008.
He said that Bank has also taken a number of other initiatives geared at enhancing its performance.
“Most notable is the finalization of the strategic and operational plan which outlines the mission, goals and objectives for making the bank more meaningful and relevant to the needs of the citizens of Dominica,” he added.
Austrie said the government of Dominica has also supported programs put forward by the AID Bank. “We recently gave an approval for the guarantee of a line of credit from the Caribbean Development Bank and it is our expectation that these facilities will assist the bank in meeting its objectives of providing affordable financing to various sectors of the economy,” he said.
Austrie said government sees the bank as an ideal vehicle to enhance economic activity in Dominica.
Meantime Austrie said government is currently seeking to increase financing for the AID Bank but there are some limitations and challenges. “The strategy is already being pursued with the implementation of a special low interest housing programme and a special facility of $2 million for agriculture, and we give commitment to continue to working with the AID Bank in that regard.
“But we must ensure that our debt target are not compromised. We must also ensure that the programs that we encourage are useful to the citizens and not in direct competition with other private sector financial institutions,” he added.
Borrowers
Austrie has also issued a call to the borrowers to be committed to repaying their debts.
He said “your failure to repay sums of money lent to you by the AID Bank will derail the entire plan that has been set up. The Bank is only able to make new loans to others when you repay. If you do not repay then taxpayers will be called upon to pay creditors of the bank. What you have benefited from you should want others to share”.
He said government is also in the process of ensuring that the AID Bank is regulated. In a few months, an on-site supervision mission will be conducted at the bBank, Austrie added.
Dominica really has no money, what is all this song and dance about, for one million profit ? If these people talk to me i will teach them how to grow this bank and make fifty million dollars in one year.
@Roz
I agree with you about not solely seeking profit, however, we have a problem where state and quasi state institutions are running up bad debts Social Security, AID Bank, NDFD for example. And there are costs associated with those debts, for every bad debt, there is a loss and that loss will be shared by the tax payers, increased interest rates for responsible borrowers, as well reduced capital available for deserving debtors. It is a situation where Peter is paying for Paul.
@Hmmm
You are using scare tactics, the same loans can be issued by other financial institutions and underwritten by the Government. If other institutions are operating with non performing loan ratios. The problem is AID Bank. There are several alternatives, for example http://en.wikipedia.org/wiki/Grameen_Bank .
Don’t get wrong I am not advocating abolishing of the AID Bank, however the board/ steering committee cannot be complacent in blaming the “Credit Crunch” for its problems. The problems are reoccuring and needs to me cut.
The Aid Bank has so many measures in place to mininize risk of not being able to collect on outstanding amounts. It seems to be a matter of non-implementation of those measures when people decide not to pay. Understand that the job of any government is not strictly the pursuit of a profit and ef like a business. So the AID bank, being an agent of the State has other fiscal objectives.
but where skerrit nuh?
mr. never in dominica man?
lol
We need to realise that the AID Bank is a development bank. Development instuitutions usually are not overly financially viable. Remove AID Bank from the picture and you are automatically removing 70% of our hotels, 80-90% of our farmers, 80% of our students that went to study and 50% of our small businesses. Now see what Dominica will look like then. GODD WORK AID BANK. CONTINUE STRIVING FOR THE BEST.
A portfolio that contains 20% of non performing loans, come on man. If the AID bank did not have the backing and protection of the Government it would fail. We cannot be speculating with the precious limited capital on a failing enterprise.