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Monday, February 24, 2025

First Citizens will not lend IDB money to govt projects

by

Curtis Williams
970 days ago
20220701
Karen Darbasie, Group CEO, First Citizens Group

Karen Darbasie, Group CEO, First Citizens Group

Lead Ed­i­tor Busi­ness

cur­tis.williams@guardian.co.tt

First Cit­i­zens will not be able to lend any of its $1.2 bil­lion fa­cil­i­ty from the IDB In­vest to the gov­ern­ment, as­sures its Chief Ex­ec­u­tive Of­fi­cer Karen Dar­basie.

Dar­basie told Guardian Me­dia that the bank will have to ac­count to the IDB for the use of the funds, re­port­ing an­nu­al­ly on the draw­downs.

First Cit­i­zens re­vealed to the mar­ket on Tues­day that it was seek­ing to bor­row close to $1.2 bil­lion from IDB In­vest or up to US $175 mil­lion.

In a no­tice to the Trinidad and To­ba­go Stock Ex­change (TTSE), the bank said its Board of Di­rec­tors had on Mon­day ap­proved the trans­ac­tion with a tenor of sev­en years. She could not say what the in­ter­est rate will be.

First Cit­i­zens said the mon­ey will be used for three things.

(1) To grow its low and mid­dle in­come house­hold mort­gage port­fo­lio

(2) Im­ple­ment its dig­i­tal trans­for­ma­tion and in­vest­ment in dig­i­tal and elec­tron­ic prod­ucts and ser­vices

(3) Ex­pand its lend­ing ca­pa­bil­i­ties to the Small and Medi­um en­ter­prise sec­tor.

Ac­cord­ing to First Cit­i­zens it al­so en­tered an agree­ment with IDB In­vest for tech­ni­cal ad­vi­so­ry ser­vice for the de­vel­op­ment of a com­pre­hen­sive sus­tain­able fi­nance strat­e­gy to fund En­vi­ron­men­tal So­cial and Gov­er­nance Ini­tia­tives.

Dar­basie said the three ar­eas iden­ti­fied for use of the funds were in keep­ing with the coun­try’s ob­jec­tives.

She ex­plained, “We think it’s aligned with the needs of the coun­try. Hous­ing stock is a need, SME de­vel­op­ment is a need, and the coun­try has com­mit­ted to a car­bon re­duc­tion fu­ture that we want to be a part of.”

The First Cit­i­zens CEO not­ed that a ma­jor rea­son it is seek­ing the loan from IDB In­vest is for the tech­ni­cal as­sis­tance that it will get in as­sess­ing green projects and fi­nanc­ing them.

“We are re­al­ly build­ing out our loan port­fo­lio in re­new­able projects and green en­er­gy type fi­nanc­ing. We’ve been do­ing some of those, but aligned with this loan we al­so en­gaged with the IDB to come in and act as an ad­vi­sor to us, to help us build out our prod­uct-line in the green space, to ad­vise us on up­skilling our staff on cred­it ad­ju­di­ca­tion, what do we need to look for when we look at these kinds of projects and to re­al­ly help build out that por­tion of our bal­ance sheet,” she said yes­ter­day.

Dar­basie not­ed that there there are sub­stan­tial so­lar and oth­er projects tak­ing place in Bar­ba­dos and Ja­maica.

“Part of the rea­son for the trip I made to Ja­maica with Ja­son, the deputy CEO…Ja­maica has de­clared a very clear goal for the per­cent­age of re­new­ables for their to­tal en­er­gy on their grid and their projects are not huge farms like we are look­ing at in Trinidad here, they are small­er plants, so­lar and wind across the coun­try.”

She added, “The large re­new­able projects in T&T are un­like­ly to be fi­nanced in the do­mes­tic mar­ket be­cause of who those par­ties are, those projects that are out­side, what we are see­ing, es­pe­cial­ly Bar­ba­dos, we are see­ing a lot of com­pa­nies in­vest­ing in small projects that they are putting on­to their own prop­er­ties but al­so sell­ing to the grid, those we think are go­ing to be quite at­trac­tive for us to take a look.”

Dar­basie re­vealed that part of the loan will be in TT dol­lars, like those for mort­gages and some of the SME loans while most of the re­new­able projects will be in oth­er cur­ren­cies.


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