Two banks halt repos, resale at height of COVID-19
TWO of the island’s major financial institutions have reported that though the novel coronavirus pandemic prevails and increases the possibility of customers falling into arrears with their loans, they have suspended repossessions and resale of assets.
JN Bank told the Jamaica Observer that it was cognisant of the impact that the pandemic has had on several Jamaicans, including many of its members, whose personal finances had been affected by the subsequent economic downturn.
As a result, the bank said recognising at an early stage the possible effects of the pandemic, it structured and implemented, through its parent company, The Jamaica National Group, a comprehensive response programme to ease the burden on members.
“This response programme included relief for our mortgagors, who have been able to access a moratorium of up to 12 months on their mortgage payments; readvance mortgages, as well as reverse mortgages to support them during this period. Similar moratoria of up to 12 months were offered to other loan recipients, who could also use the compulsory savings deducted from loan payments to cover loan obligations, or suspend the compulsory savings component for a period to lower their monthly payments,” Gareth Manning, manager of the Media Relations Unit, JN Group Corporate Communications, told the Sunday Observer.
“Through these avenues we have been able assist thousands of Jamaicans from defaulting on their obligations and maintaining a positive credit rating. However, as the pandemic continues, we recognise that many people still need support and, therefore, we have continued to assist persons to avoid falling into arrears. These continued proactive approaches have allowed us to protect our members and, at the same time, maintain the integrity of our credit programme,” added Manning.
Meanwhile, Scotiabank told the Sunday Observer that there has been no unusual changes regarding repossessions since March and as part of its relief programme to customers, Scotiabank temporarily suspended litigation and sale of assets.
Scotiabank explained that after a loan account becomes non-performing – 90 days or more – several options are explored with its customers that are aimed at preventing these measures and only when these options are exhausted does the bank take steps to recover the assets used to secure a loan.
Further, if a client is behind on a loan payment, Scotiabank said to avoid repossessions, customers can request refinancing or debt consolidation options, which include loan term extension and flexible payment arrangements to assist customers who are having financial challenges.
“Scotiabank proactively monitors all accounts at-risk of becoming delinquent and actively works with our customers to prevent loans from being classified as non-performing. Following the COVID-19 crisis, we provided special assistance to our customers wherein, we allowed borrowers to defer payments up to 3 months including principal and interest. This was applicable to all loans and credit cards,” a statement from the bank read.