THE Belize government is to launch a national bank that Prime Minister Dean Barrow said should place pressure on commercial banks to reduce lending rates to consumers in the future.

Prime Minister Barrow said that the National Bank of Belize Limited will have a start up capital of BDZ$20 million (one Belize dollar = US$0.50 cents) that will come from PetroCaribe funds.

“The mission of the bank is principally to make residential mortgage and other consumer loans available to lower to middle income Belizeans and in particular to public officers and teachers at cheaper rates than are being offered in the market at this time,” Prime Minister Barrow told reporters.

He said the government is “directly intervening in the market to cut down costs in a sector that for too long has given little back to those on whose backs the profits are made in the first place,” he said, adding “the whole idea is to put pressure, downward pressure, on the lending rates of the commercial banks.

“The bank expects to lend to consumers at an interest rate of approximately 6.5 per cent on average,” he said, adding that since the bulk of the money will be lent to teachers and public officers “we expect there will be a minimum non-performing element in terms of these loans.

Prime Minister Barrow said that the board of directors and a managing director have already been named and the idea is to turn the national bank “into a full bore, scale bank… (with) all the services”.

— CMC