What Banks Offer Reverse MortgagesWhich banks offer reverse mortgages?
Trinidad and Tobago have a number of characteristics that are beneficial to the growth of global finance, as outlined in the World Economic Forum's Global Competitiveness Report 2014-15. Despite being the number 89 out of 144 competitors rated worldwide, T&T came number 38 for its macro-economic performance, number 52 for infrastructures and finance, number 69 for corporate performance and number 77 for higher learning.
With a share of around 16% of GNP, T&T's broad-based finance service activities (including insurances and property services) are the second biggest economic activity after the oil industries, which generate around 38% of value added. T&T's major T&T insurers, operating throughout the Caribbean, have economies of scales.
T&T International Financial Centre has made it easier for Canada's top banks to set up back and front offices in the state. T&T's eight banks are well capitalized and are supported either by the state or by large multinationals. Another strong point of the industry is that it comprises four specialised government-backed institutes that concentrate on specific financial industry policies.
The three T&T Mortgage Finance Company (TTMF), Home Mortgage Bank and the Agricultural Development Bank of T&T (ADB) were selected by the Federal Reserve as relevant to the system. Our export import company EXIMBANK (Bank of T&T) is the second. The TTMF is an agent that offers mortgages to first-time buyers. It is 51% National Insurance Board of T&T (NIBTT), the main body of the welfare system, and 49% National Insurance Board of the State.
Headquartered in Port of Spain, TTMF has offices in Arima, Chaguanas, San Fernando and Tobago. The TTMF also offers mortgages protection in connection with Cuna Caribbean Insurances, which guarantee reimbursement of the credit in the case of the death of a mortician. TTMF provided 6% fixed-rate mortgages in 2013.
During the year, the balance sheet increased from 3.5 billion TT$ (539.7 million $) to 3.7 billion TT$ (570.5 million $). This includes an expansion of the mortgages portfolios from TT$ 3 billion ($ 462.6 million) to TT$ 3.2 billion ($ 493.4 million). The TTMF finances its operations mainly by issuing long-term debt and by selling mortgages in the subprime markets.
The HMB was founded in October 1986 in reaction to a recent International Finance Corporation (IFC) survey that found an urgent lack of accessible middle-income homes. IFC also noted that the volume of mortgages was well below the upside. However, the suggested approach was to create an organized collateral submarket for mortgages.
The HMB became the most important institute in T&T's aftermarket. HMB's tasks also include "mobilising energy saving for investments in residential construction, supporting[the] creation of a system of financing properties and housing" and promoting "capital markets growth". TTMF and HMB purchases mortgages from TTMF and individual banks.
Credits are also granted, which make up around 40% of the entire credit portfolio. HMB, as a lender, provides full coverage of the entire value of the mortgages, with an in-house authorization threshold of $5 million TT$ ($771,000). The mortgages will be granted via the Port of Spain headquarters, although HMB will open an extra branch in Chaguanas.
She has a clear bias towards mortgages, housing mortgages, property purchases, building, equity finance and apartment buildings. MMB also offers reverse mortgages. Credits up to 5 million TT$ (771,000 $) are internally authorized, which means that the processing times of the authorization are quicker than with other banks. HMB's mortgages in 2014 increased by TT$ 386 million ($ 59.5 million); TT$ 123 million ($ 19 million) came from the original markets and the balance was acquired on the collateral markets.
The balance sheet totals at the end of the year were TT$ 2.3 billion ($ 354.7 million). Receivables include $514 million TT$ ($79 million) and financial investments of $1.7 billion TT$ ($262.1 million), of which $1 billion TT$ ($154.2 million) in shares and $645 million TT$ ($99.5 million) in bonds and notes that have been originated by the federal and state governments.
Refinancing borrowings totaled TT$ 1.1 billion ($ 169.6 million), while equity positions totaled TT$ 474 million ($ 73.1 million). T&T Securities and Exchange Commission (TTSEC) and are considered eligible investments for the legal deposit and legal fund of insurers. Our products are appealing to business customers and property insurers.
HMB has been issuing guarantee mortgages since 1999. This is a securitised, backed mortgages obligation that can be tailored to investors' needs in relation to interest rate and redemption characteristics. Garanteed mortgages give the investor the opportunity to keep mortgage-backed securities without having to commit to a single mortgages over the long run.
Lastly, since December 2001 HMB has been managing the MPF (Mortgage Participation Fund), an investment trust secured by mortgages and incorporated with TTSEC. The inflow into the MPF is covered by the carry-over of mortgages from HMB's assets. HMB guarantees the floating yield (monthly and 1.35% at the date of writing), which is the difference between this instalment and the interest payment made by the borrower.
The mortgages managed by HMB, some of which were assigned to MPF, amount to around TT$ 1 billion ($ 154.2 million) according to Ramlogan. HMB's 2013 business year noted that PwC had been mandated to assess the feasibility of reorganising the property and operation of TTMF and HMB. Since 2011, press coverage has focused on the possible amalgamation of the two companies and their stock exchange listings on the T&T stock exchange as part of an IPO.
NIBTTT, which is the dominant stockholder in TTMF and HMB, will determine whether and under what conditions such a deal will take place. ADB is a classical agro developing school. Premier Wendy Samsundar Beharry, ADB's Head of Operations, said to OBG that the institution's general understanding of the farming company covers all operations associated with "transporting foods from the farmyard to the plate".
A loan can be granted for working capitals or investments in capitals (i.e. real estate and/or plant). Currently, it is financed from reserves and by the State, which holds 97% of the shares in the EIB and is 100% owned by the EIB. EXIMBANK, the country's only officially registered ECA, was founded in 1997 from T&T Transfer Insurance Company, founded in 1973.
Expimbank finances its business activities through credits from business banks and revenue reserves. Receivables due and payable for payment by EXIMBANK are warranted by the governments to which the agencies belong. In all, there are four product offerings by EXIMBANK: post-shipment funding (factoring of bills for goods or a service for exporting customers), pre-shipment funding (a short-term instrument to buy inventories before export), buyer credits (financing investments in plant and/or refurbishment of premises) and trade credit protection (to protect against the loss of goods or service by overseas buyers).
EXIMBANK's non-audited financial statements showed a balance sheet totalling TT$402 million ($62 million) and principal positions of TT$192 million ($29.6 million) at the end of June 2014.