Fri | Aug 18, 2017

DBJ receives high ratings

Published:Wednesday | June 29, 2016 | 6:00 AM
Christopher Zacca

In its latest release for the end of the 2015-16 financial year, the Caribbean Information and Credit Rating Services Limited (CariCRIS) has reaffirmed its corporate credit ratings for the Development Bank of Jamaica (DBJ).

In 2015, CariCRIS upgraded the DBJ's ratings to CariBBB+ (foreign currency rating) and CariA- (local currency rating) on the regional rating scale and jmAA on the Jamaica national scale, with a stable outlook.

According to the agency, these ratings have been endorsed, indicating that "the level of credit-worthiness of this obligation, adjudged in relation to other obligations in the Caribbean, is adequate. The Jamaica national scale ratings indicate that the credit-worthiness of local-currency debt of DBJ, adjudged in relation to other local currency debt obligations in Jamaica, is high."

CariCRIS noted that "the ratings reflect DBJ's strategic importance to the Government of Jamaica (GOJ) as the lead development financier and manager of the GOJ's Privatisation and Public-Private Partnership (PPP) Programme for state assets in Jamaica, as well as the bank's improving loan quality underpinned by relatively low credit risk and continued development of risk-management tools.

"The ratings are further supported by DBJ's good financial performance, evidenced by moderate revenue growth and profitability, albeit lower than the prior year, with strong capitalisation metrics. These rating strengths are tempered by high sovereign-risk exposure to the Government of Jamaica in spite of its improved economic conditions."

FINANCIAL VIABILITY

DBJ Chairman Christopher Zacca, in commenting on the CariCRIS release, said, "I am not surprised that the DBJ has continued to receive such high ratings. This is one government financial institution that pays keen attention to its financial viability, while focusing on the real reason for its existence - the development of the country. These ratings are a tribute to the vision of the former board under Chairman Joe Matalon and the skills of the DBJ management and staff; and I have no doubt that the bank will continue to get similar or better ratings in the future."

Milverton Reynolds, DBJ's managing director, was happy with the reaffirmed ratings which, he said, was particularly important because they were assigned by a completely independent and objective organisation. "I must thank the board of directors for their direction, as well as the bank's dedicated and loyal management team and staff without whom none of our achievements would be possible."