The Government of the Virgin Islands has announced that it has secured a loan facility of one hundred million dollars ($100,000,000) CIBC First Caribbean Bank (Cayman) Limited to support critical infrastructure development across the Territory.
Premier and Minister of Finance Honourable Dr. Natalio Wheatley stated that his initiative aligns with the 2024-2026 Medium Term Fiscal Plan and the Medium-Term Debt Strategy.
Premier Wheatley said, “Securing this loan is a vital step in our commitment to enhancing the infrastructure of the Virgin Islands. This funding will enable us to invest in critical projects that will benefit our communities for years to come. It is essential that we remain steadfast in our pursuit of sustainable development and improved living standards for all our residents.”
Following a formal procurement process initiated on April 26, six local financial institutions were invited to submit proposals by May 28. Four proposals were received and after a thorough evaluation, the Central Tenders Board recommended, and Cabinet accepted, the proposal from CIBC FirstCaribbean Bank (Cayman) Limited, pending further negotiations on the terms.
The proceeds from this loan will be allocated as follows:
- Financing critical infrastructural projects within the Government, including recurrent and capital expenditures, amounting to ninety-one million, sixty-five thousand dollars ($91,650,000).
- Refinancing balloon payments due in 2026 on existing loans, totaling seven million, nine hundred and ten dollars ($7,910,000).
- Covering transaction costs associated with arranging the loan facility, amounting to four hundred and forty thousand dollars ($440,000).
The loan facility will be repaid over an eighteen-year period, featuring a fixed interest rate of 6.50% per annum for the first ten years, with options for adjustment thereafter.
Additionally, the interest will be paid semiannually, starting two quarters after financial close, with a principal payment moratorium for the first three years.
Premier Wheatley said, “While this new loan will increase the Central Government’s overall debt stock, it is important to note that this decision was made following rigorous due diligence and analysis to ensure that debt servicing remains manageable and sustainable. The recently laid Medium-Term Debt Strategy 2024-2026 outlines a comprehensive framework guiding the Government’s borrowing policies and debt management practices.”
The loan signing ceremony is scheduled for October 31 at 10:00 a.m. and will be streamed live on the Government's official Facebook page.
The Government was represented in the loan negotiations by the Ministry of Finance together with Senior Crown Counsel, Renard Penn and Omonike Robinson-Pickering (Partner) and Matthew Cowman (Managing Partner) of Walkers acting on behalf of the Attorney General.
The Government remains committed to the responsible stewardship of public finances while investing in the future growth and development of the Virgin Islands. This loan will enable the implementation of vital infrastructure projects that will enhance the quality of life for all residents and bolster the Territory's economic resilience.