Financial companies repay BoJ emergency loans

The Bank of Jamaica says financial institutions it loaned money, to help meet margin calls, have been repaying faithfully.

The Central Bank's latest balance sheet, released on Tuesday, showed that at the 25th of August, total monies owed to the Bank of Jamaica by financial institutions, stood at $14 billion.

Deputy Governor at the Bank of Jamaica, Livingstone Morrison, confirms this is what is owed after $8 billion was paid in the last year.    

“The institutions that we were provided with margined loans to facilitate their transition following the financial system crisis over a year ago, those institutions have been repaying the amounts advanced to them in accordance with the schedule that we have agreed with them. The Bank of Jamaica is really pleased in what has been transpiring in that regard,” Mr. Morrison said.

Mr. Morrison said the $14 billion that is outstanding, should be paid before the end of this year.    

He said the Bank of Jamaica took a 25% loss, on the amounts owed, in the recent debt-exchange programme.

At the height of the global financial crisis, in 2008, several local financial institutions were called upon to meet payment obligations to overseas financial entities.

The Bank of Jamaica, at that time, set aside US$300 million to help the financial houses meet the obligations.

However, only about $170 million of that amount was actually used.