Biz Bits

The Central Bank is reporting a 10 percent hike in non-performing loans for the month of August — a full point jump from December's closing numbers.

"The impact of the economic slowing has been most pronounced on the commercial sector, whose operations have been adversely affected by increased operating costs and reduced revenues; and an increasing number of loans are now more than three months in payments arrears," the Bank said. "This situation is likely to continue in the near-term, until the economic situation shows renewed signs of improvement."

Still, the Bank's numbers confirms earlier Guardian Business articles, citing loan defaults were on the rise. Banks, furniture stores and others extending credit are already reporting hikes in the number of delinquent accounts, with many of them now unwilling to extend the same level of credit of even a year ago.

Many are, however, actively negotiating with customers for reduced payments rather than rushing to repossession.

One of the nation's leading credit unions reported a near 20-percent increase in delinquencies coinciding with the downturn in the economy. It has forced The Bahamas Islands Resort and Casino Cooperative Credit Union to negotiate re-payment plans for the growing number of its members struggling with reduced work hours and income — a decidedly different approach than that of commercial banks struggling with the same phenomenon, said one representative.

"In cases where it get continuous for a number of months, we realize we have to make adjustments to their loan [payments] because it's not their fault," Marvin Smith, an agent at BIRCCCU, told Guardian Business. "A lot of people are down to two or three days [of work] a week, from as early as the end of last year."