One Large Loan on NCB
National Commercial Bank of Jamaica’s (NCB) said The dramatic increase in bad debts on its books in the June quarter was due to default on “one large loan”. NCB’s corporate banking unit arrange for failing to service a US$88-million financing facility three weeks ago it placed Palmyra Resort and Spa in receivership. It was after reclassifying the loan in the bank’s second quarter ending March. spokeswoman Sheree Martin said “The loan is fully secured by real estate.”
in 2007 , NCB structured financing for the condo-hotel development. It assumed only a portion of the liability. The syndication included RBTT Jamaica, now RBC Royal Bank Jamaica, and NCB Capital Markets. NCB’s non-performing loan (NPL) portfolio was estimated at 7.3 per cent of its total loan portfolio at June 2011 or J$6.7 billion. based on NCB’s disclosures about J$2.5 billion to J$3 billion is related to the Palmyra debt,The Financial Gleaner estimates.
the bank’s performance compares favorably with the commercial banking sector and is comparable to Scotiabank Jamaica that of its closest rival. Industry NPLs rose to 6.9 per cent of total loans at March 2011 or at J$17.1 billion. at last disclosure in April 2011, Scotiabank reported NPLs of J$4.223 billion, or 4.2 per cent of total loans. NCB continues to monitor delinquent accounts closely.