SSB to decide on 12 Million dollar loan to Santander Print E-mail
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Thursday, 11 February 2016 00:00

Over the past few days much concern has been brought up by some regarding a proposed 12 million dollar loan that Santander has approached the Social Security Board to finance. Santander is the company which is in the process of establishing a sugar producing factory in western Belize. The company has already established a state of the art factory complete with 18 thousand acres of sugar cane ready for harvesting. The company has said that the process of harvesting will commence by the end of this month.

While the company prepares itself for full production, it is at this point in time securing financing to complete a U.S. 142 million dollar investment in phase one of their project which includes the factory and cane fields. Already the company has put up U.S.  47 million dollars and borrowed 95 million in a syndicated loan from banks in Belize, Guatemala, Washington DC, Panama and Honduras. Of that syndication Belizean banks hold U.S. 59 million dollars of which the proposed 12 million dollars will be a part of.

The Social Security became involved in the whole process after a bank in Guatemala which had already committed to a portion of the loan pulled out because it is limited in its capacity to lend outside of that country. That happened in June of last year and since then Santander has been looking for another institution to cover the shortfall which was created by the exit. They then approached the Social Security Board for the loan in October of last year and the SSB investment committee has given the go ahead for the loan.

No money has been disbursed and when the Guardian spoke to Chairman of the Social Security Board, Douglas Singh he explained that a final decision has not yet been made but when it is made it will be taking careful consideration of the public’s best interest, after all the investment will be from the people’s money.

It is noteworthy that every investment that the SSB has made under the stewardship of the United Democratic Party has yielded excellent results. The most recent example of sound investment decisions came by way of a 15 million dollar investment in BEL 10 million by way of preference shares and 5 million dollars by way of debentures which earned the board 3.1 million dollars in returns. That averages out to annual interest of 6.6 percent.

The Santander loan is proposed to be for 10 years with interest rate at 8% for first two years and 7 percent thereafter when principal is being paid.