Around US$69m in loans benefited from pandemic relief measures – IDB report

Persons with loans who were at risk of defaulting during the COVID-19 pandemic benefitted from policies implemented by the Government, the Inter-American Development Bank (IDB) noted.

Approximately US$69m worth of loans benefited from the relief measures.

In its quarterly report on the Caribbean dated August 2021, the IDB said that main policy tools introduced by the Bank of Guyana were extending debt payment schedules and reduced interest rates for certain loans. The report noted that the relief period was introduced in 2020 and continued through June 2021.

These measures allowed beneficiaries to not have their loans classified as nonperforming. To support liquidity, the report added, the central bank reduced a series of policy rates such as the reserve requirements, liquid asset requirements for demand deposits, and savings and time deposits, freeing up resources for loans.

“Commercial banks agreed to provide short -term loans at concessional rates between 5- 6 percent, lower than the prime lending rate of 10.3 percent. Commercial banks agreed to offer general concessional reductions of interest rates of 1 percent and up to 2 percent on consumer loans below G$10 million (US$48,000). The total loan portfolio of deposit-taking institutions was approximately US$1.5 billion in December 2020. Of that total, approximately US$69 million benefitted from relief measures, accounting for 4.6 percent of total loans,” the report said.

The report went on to state that that new COVID -19 cases increased significantly towards the end of the first half of 2021 in

Guyana. This trend is similar to that observed in other Caribbean countries as well as the region at large. According to the report, the average number of daily new cases per month increased from 42 in January to 118 in May and declined to 80 in July. Similarly, the total number of deaths per month increased from 12 in January to 93 in May, declining to 72 in July.

Meanwhile, the seven-day rolling average of new cases per day peaked on May 28, with 180 cases per million population before declining to 50 on August 10, below the peaks of Trinidad and Tobago, Suriname, and The Bahamas. As it is now, it was pointed out, only Barbados has fewer daily new cases than Guyana.

The report also noted that the government updated the COVID-19 measures on

July 29th, effective for the month of August with one of the new measures being that anyone entering a government building must show proof of vaccination or seek services by appointment only. In addition, all operators of transportation services, both domestic and international, must also be able to show proof of vaccination to conduct their business activities. According to the report, this measure has affected both private and public sector workers, such that the Ministry of Health announced on August 12 that health and public transportation on workers would be given a two- week extension to comply with the vaccination requirement.