Bankers suffering withdrawal symptoms
Re: Who will save us from the addicted bankers?
I have a loan with one of Jamaica's leading banks and recently I penned a letter to them, the contents of which is as follows.
RE: XXX Loan
Based on the recent reduction in interest rates resulting from the Government's Jamaica Debt Exchange (JDX) programme, I am using this medium to officially ascertain when I am likely to receive a reduction in the interest rate and commensurate lowering of my monthly payment regarding the referenced XXX loan.
I anticipate and will greatly appreciate your usual prompt response.
The very next day, after dispatching the above letter, I was contacted via telephone by a relationship officer of the bank acknowledging receipt of same, and who proceeded to advise that my payment was fixed for the first two years of the loan, after which it might be reduced. However, when I informed him that the documents I have in my possession pertaining to the loan states nothing of the sort, and that my loan was a variable interest rate, and the document actually states, "Your loan is calculated at 33.75 per cent per annum on an effective rate basis. This interest rate is subject to change by at last 30 days notice in writing from the bank," his immediate response was that he would have to review my file and get back to me, and we parted on that note.
Until further notice
About an hour after our initial telephone conversation, the relationship officer called back to inform me that I was correct, i.e., my loan was actually as I stated. However, the bank has not yet lowered the rate of interest. consequently, the status on my loan will remain as is until further notice.
A relative of mine has a motor-car loan with the same bank, and on making a similar enquiry regarding his loan, received the same response, i.e., his loan is fixed for the first two years and thereafter it varies. This appears to be the standard response by this bank to all enquiries regarding the lowering of interest rates on existing loans.
In another example, a colleague of mine has a motor-car loan with another leading bank and made a written enquiry similar to the one mentioned above, and below is the response he received from them via email.
Xxxx Xxxxxx Bank, in keeping with what is happening in the economy, and more so with the terms of the JDX programme, will reduce interest rates over time. We do not now have a definite date from the board of directors, however, we know that it will be within the next few weeks and each customer will be advised in writing accordingly.
This was despite the fact that the loan was granted by the bank in question at an interest rate of 19.75 per cent, and they are now offering motor-vehicle loans at a rate of 16.75 per cent, a difference of three percentage points.
Addicted to high interest rates
Based on the aforementioned, I am recommending that all recipients of bank loans carefully review their loan documents and familiarise themselves with the terms and conditions of same, as it appears that our bankers are suffering from the same withdrawal symptoms affecting our police force, resulting from the powers given them during the state of emergencies which, over time, has destroyed their ability to effectively execute their duties.
The bankers, having been addicted to the high interest rates for such a long time, are now finding it extremely difficult to wean themselves of same. And the irony is that if the interest rates had trended in the opposite direction (upward) every person having a loan with a bank would have now received notification advising of the rates increase and the commensurate increase in monthly payments.
Consequently, I am asking the question: who will save us from the addicted bankers?
I am, etc.,