Caribbean Tires Loan from SSB Went Through Full Process

Back in September, the Social Security Board announced plans to lend Caribbean Tire Wholesale seven million dollars for capital expenditure and cash flow replacement. Today, S.S.B.’s C.E.O., Doctor Leroy Almendarez, confirmed that the loan has successfully gone through the full approval process. The loan comes with a fifteen-year term and an annual interest rate of six-point-five percent, payable in monthly installments. Almendarez explained that S.S.B. provides loans like these to avoid prematurely increasing the contribution rates we all pay.

 

Dr. Leroy Almendarez, C.E.O, Social Security Board

“ The purpose of giving out loans and it’s loans for development as well, is that that interest income is also added to contributions, but it goes through proper, proper assessment. In essence, you know, if you were to get seven million dollars, the collateral that we get to secure that for us is greater than the seven million. And of course we would have to look, if it says whatever number, it is, we do an amortization table, which is telling you over a period of time of the loan until it terminates. All the payments will come in, how much interest income we expect to get so that we can forecast. We can forecast that money. The other thing we do, of course, is invest. We invest in utility companies, so we have equity in there, and in some cases, thirty-three plus percentage. And that interest income on a large scale, that money is also added. What does that help us to do?  It helps us to not even think about increasing the rate of contribution. It also stops us or helps us not to go to government and say, you know what, we have a shortfall here because the other thing we continue to monitor when you’re making these payouts, at what point will payouts be equal to the money that you collect? That’s called the point of equilibrium. Then that becomes a challenge because it simply means after that point, paying these payouts then becomes a challenge.”