Look at it from our perspective, the perspective of someone who is younger than both CCB and NBA. From the eyes of someone who has struggled to continue paying his/her loan and not missing a beat, even after losing his/her job, and all the other struggles that come along with that. So my question to you “old folk”, “banker-naires”, “share-nairians” and all the “save the bank advocates” out there: are your obligations up to date. If not, what is your excuse?
Why have you not paid your house loans, business loans, and “just because” loans, that you have?
Why have you not cleared up your overly overdrawn checking accounts?
How can we the young people of Anguilla listen to you on radio day after day, when you are a major part of the problem. We, the younger folks of Anguilla, do not get any huge breaks from the banks. They will call us relentlessly if we slip up. But others can show up with a brief case, suit and tie, think up any old business venture and get funding with minimal hassle. Refinancing and then re-refinancing is the order of the day for them – as long as the books look good, all is well. You all sometimes even boldly show up at the bank and demand that your “bouncy”, “rubbery” cheques are honoured, and just like that they slide through “the system”.
How can you really advise? How can we take you seriously? Thus far you have been looking out for yourselves alone. We cannot believe now that you are looking out for the interest of us all. What have you all left for the younger generation?
On the flip side, there are others that need to take responsibility as well. What about the DMCs (Directors, Managers and Chiefs)? We thought they were supposed to protect the banks by making informed decisions before approving loans. Perhaps DMCs should be replaced with three heftier words. Just a thought!
It seems as though many loans were based on friendship and “who ya know” rather than ability to pay. In determining an individual’s “ability to pay” there are many factors to consider. Many of these factors were blatantly ignored. Here are a few “non-rocket science”, simple, layman’s term suggestions or guidelines rather, that you all should reference before approving “any ole loan”:
Payment History: Simply put, if you did not pay your last five loans in a responsible and timely manner, chances are you will not pay the sixth one either.
Income (Scenario 1): If there is no disposable income (extra money) after all of an individual’s bills are paid for the month, then giving them an added obligation is probably not a good idea.
Income (Scenario 2): If the income becomes strained (sickness, other emergency) what are the chances of default. If it is a long term loan do they have a co-borrower?
Collateral: What exactly is securing the loan? If it is land, is it being used to secure other loans as well? If it is, then this loan will be secured on paper but, realistically it is not secured in the best interest of the institution. Is the valuation of the security realistic and in line with the current economic situation? Or is it exaggerated?
Assets: What other assets do the individuals have that can easily be sold if need be?
Age of Individual and Term of Loan: The two of these factors go hand in hand. The older the individual the more risky a long term loan is for the bank. Let us be realistic and apply some simple arithmetic. If someone is 55 years old with a 30 year obligation, this is a problem. Statistically life expectancy in Anguilla is 80 years old. In essence, some persons are now closer to death than the maturity date of their loans.
Let me break this down further because at first glance figures may seem exaggerated. Initially an individual may not have signed up for a 30-year loan. But by not paying his/her obligations on time, or completely missing payments, the loan can drag on for much longer than anticipated. Additionally, granting someone a loan for a shorter period of time because of his/her age is not always helpful. Remember that the shorter the term of the loan the larger the monthly payments. So can he/she really afford it? Or will missed payments and added interest still equate to longer terms?
These are just a few of the factors to consider. There are many others that are important as well. But, DMCs this is just a start. I am sure you all can come up with a few more guidelines that should be followed across the board for all individuals.
In conclusion, and in keeping with the simplicity of this perspective, how do we solve the issue or at least take a step in the right direction? “Go and pay who yuh owe!” If every individual who is working – and has some sort of income – takes a minute to write down all of his or her obligations, and make a strategic effort to tackle each outstanding obligation, this would be a step in the right direction.
To those individuals who directly have obligations with these institutions, it is on you to make a real effort to honor these obligations and make your loan payments. Sitting back and waiting is not a solution. How do you plan on straightening up your finances? How can you solve the bank situation when your individual situation needs a solution as well?
There are other persons who may not directly have a loan, with the banks. However, if you owe an individual “go and pay yuh bill!” They may have a loan that they need to pay. By not paying your bills, you are a part of the “banking situation”.
Signed
TLV
