Outstanding loans from local commercial banks to the private sector stood at $82.3 billion at the end of last year, an increase in lending of $17.8 billion from the $64.5 billion outstanding at the end of the previous year, Chairman of the Board of Directors of the Institute for Private Enterprise Development (IPED) Yesu Persaud disclosed in the institute’s 2012 annual report.
And according to Persaud, who is also chairman of the indigenous, commercial Demerara Bank, “for every hundred dollars in loans outstanding by the commercial banks, IPED has $2.7 outstanding,” a circumstance which he said is indicative of IPED’s “small but significant contribution to the development of small enterprise in Guyana.”
In the IPED 2012 report released last week following its annual general meeting Persaud disclosed thatthe small business lending institution had secured a $410 million term loan from Demerara Bank of which $210 million was drawn down at the end of last year. The acquisition of the loan pushed IPED’s liabilities as a proportion of total assets from 12 per cent in 2011 to 18 per cent in 2012, the IPED chairman said.
Persaud disclosed in the report that at the end of 2012, the total assets held by IPED reached $2.846 billion, an increase of $241 million from the 2011 figure of $2.425 billion. IPED’s assets were funded mainly by accumulated surplus which accounted for 82.7 per cent of total assets held in 2012 compared with 88 per cent of assets held in 2011.
Persaud said the quality of the lending institution’s loan portfolio continues to improve from year to year. Figures published in the report indicate that last year the monetary value of non-performing loans reduced to $45.9 million from $48.8 million in 2011 adding that the improvement in the quality of its portfolio obviated the need for IPED to increase its provision for loan losses during the year.
Pointing out that a strong financial performance is necessary for IPED’s growth and sustainability, Persaud disclosed that demand for the institution’s services meant that its loan portfolio increased from 24 per cent in 2011 to 24.7 per cent last year.
Last year, IPED recorded $217.2 surplus in revenue over income compared to $177 million in 2011. “This,” according to the IPED Chairman, was an indication that the entity’s resources “were managed prudently and with great care to ensure our continued survival and investment into the future as a development institution.”
Meanwhile, Persaud said that apart from its role in providing credit facilities IPED continued to offer technical assistance and training to the micro and small business sector through its Entrepreneurial Development Centre (EDC). Last year, IPED’s implementation of the Inter American Investment Corporation’s (IIC) Innovative Financing for SMEs (FINPYME) Export Plus Programme, had provided training for 175 small business owners in several disciplines including business management, financial management and business strategy. IPED, through its EDC was also associated with training provided by the Caribbean Development Bank (CDB) and USAID.
