The Institute of Private Enterprise Development, IPED, this week reported that the gross loan portfolio as at December 31, 2018 grew to $3.008B or by 7% from $2.806B in 2017.
During 2018 IPED processed and disbursed 4,091 loans for a value of $2.663B compared to 4,218 loans for a value of $2.684B in 2017.
This is a decline of 3% and 1% in number and value respectively. The total number of loans outstanding as at December 31, 2018 declined to 3,938 or 3% from 4,064 in 2017.
IPED Chairman, Komal Samaroo, addressing the Annual General Meeting said that “IPED continues to be a pillar in the growth and development of the ordinary man and woman in their quest of owning their own businesses.”
The overall quality of the loans portfolio has recorded a marginal improvement with Portfolio at Risk (principal balance of loans in arrears for more than 30 days as percentage of gross loans) being 16.16% in 2018 compared to 18.35% in 2017.
Non- performing loans as a percentage of gross loans improved from 10.2% in 2017 to 9.8% in 2018. Data obtained from loan applications processed in 2018 indicates that micro and small businesses supported by IPED employed approximately 8,627 persons. Of the total applications processed in 2018, loans to female principal borrowers were 33% (2017: 35%), Rural borrowers were 93% (2017: 91%),
Youth borrowers were 5% (2017: 6%), and 72% (2017: 76%) for borrowers without real estate collateral.
The financial position of IPED has strengthened over the year and continues to be stable. Total assets grew to $3.720B or by 8% from $3.498B at December 2017. This is financed by $3.267B (2017: $3.221B) of accumulated funds and surpluses. Total Liabilities increased to $454M or by 63% from $278M at December 2017. During 2018 a loan of $200M was drawn down from Demerara Bank Limited and $41M from the IDB.
These were used to fund the growth of the loans portfolio. The financial performance for the year has improved with a total surplus of $102.5M for the year compared to $85.7M for the year 2017. This is an increase of $16.8M or 19.6%. The total interest income for the year was $539M compared to $512M in 2017, an increase of $27M or 5%.
Total investment and other income was $57M compared to $55M in 2017 an increase of $2M or 4%. The total expenses for 2018 were $490M compared to $479M in 2017, an increase of $11M or 2.3% THE YEAR 2018 came with its fair share of challenges but vigilance, strategic decision making and innovation has allowed us to emerge with satisfactory results.
During the AGM Chairman Samaroo also announced the retirement of founding Chairman, Dr. Yesu Persaud, who retired from the Board of IPED at the end of January 2018. Samaroo said “His leadership and sterling contribution over 32 years to the development and growth of IPED, an institution focused on improving the livelihoods of micro and small business entrepreneurs, will not be forgotten.” IPED is a not for profit organization but manages its financial affairs to ensure that the institution is sustainable and self-sufficient. All surpluses will be used to enhance our outreach to micro and small businesses in 2019 and thereafter.