Mortgagors with the New Building Society (NBS) saw rebates of $800m for 2022 and $850m for 2023 after a decision to drop lending rates to as low as 3.5%.
NBS registered a profit of $679.8m for 2023, down by 27% from the 2022 mark. According to the financial statement for the mortgage institution published in the March 20th Guyana Chronicle, the 2022 profit was $931.8m.
In his report at the April 13th 2024 Annual General Meeting, NBS Chairman Dr Nanda K Gopaul said that 2023 had been “a year of both challenges and successes however; the Society sustained its strong financial performance as we pursued our concept of mutuality and strove to balance the needs of our savers and borrowers in the growing competitive financial sector in Guyana. The prevailing economic boom in the housing sector, has allowed the New Building Society to deliver a commendable financial performance maintaining a robust balance sheet, strong capital and liquidity positions which were well above the statutory requirements”.
Gopaul said that following discussions with Presi-dent Irfaan Ali in 2022, the Society took a “conscious decision” to cut interest rates to the lowest ever in its history bringing the lending rates to as low as 3.5 percent.
“We made these lower rates available to all our borrowers currently holding mortgages with the Society. As a consequence, our mortgagors would have benefitted from interest rebate in the sum of approximately $800M for 2022 and $850M for 2023. We have also allowed our savers to earn the highest rate of 2.75% in the banking industry”, he stated.
He said that the Society is positioned to take advantage of emerging
opportunities as it continues to grow its mortgage business alongside the Government of Guyana’s housing drive. For the year 2023, he pointed out that the NBS had disbursed in excess of $19B to approximately 2,300 borrowers, the highest in the Society’s history.
Gopaul said that the number of mortgagers at the end of 2023 was 11,059 with a portfolio balance of $64.6B (2022 – 10,002 mortgagers with a portfolio balance of $49.6B), representing a “magnificent” increase of 30%.
“Our mortgage business increased in 2023 as a result of the government’s accelerated housing programme and the housing market’s recovery from the COVID-19 epidemic.
“Additionally, with continuous repayment deferrals and the granting of moratoria, the Society continued to assist mortgagors whose earnings were negatively impacted by the COVID-19 epidemic in 2023”, he said.
In parallel, Gopaul said that the Board monitored and managed risks related to non-performing loans, “which have increased over the past few years and are a problem that not just the New Building Society, but also other financial sector operators have to deal with”.
He asserted that the Society’s lending guidelines are designed to safeguard members’ funds while enabling borrowers to become homeowners.
