The Barbados National Bank (BNB) says it will not cloud the sale of any foreclosed house in secrecy.
Derwin Howell, managing director and chief executive officer of BNB, said the sale of homes or commercial properties of people unable to pay their mortgage debt was a development taking place across the banking system.
BNB has a total of 48 houses in the foreclosure process which have been accumulated over a period of years noting that the legal process was an extremely lengthy one. Those 48 houses, he said represented less than one per cent of BNB loan portfolio of several thousand mortgages.
Howell, who took over top management of BNB late last year, told BARBADOS BUSINESS AUTHORITY: “It is across the board – except that we do it in a different way and we do it at different times,” as he referenced the bold, large ads BNB has published in the Press.
“The reality is . . . we have an obligation to advertise these things prominently. I can’t just put two ads in the Wednesday edition in back with the classifieds and that is it.”
According to head of the Trinidad-owned Republic Bank subsidiary, he did not want the institution to be accused of colluding with any individual or institution to cheaply dispose of clients’ homes.
“Before we sell a house, I get memo that says how many times [we] advertised it, where we advertised it . . . what was the highest bid and what was the lowest bid and what was the average bid, so that there is a level of transparency.”
“We certainly don’t want anybody to come to us and say that ‘you take my $500 000 house and sell it to one of your friends for $200 000’. The bids are opened under dual custody, and they are sealed bids – so we have a very transparent process of how we do things.”
Dismissing any suggestion that the bank was a “fair-weather friend”, Howell said what was happening in the banking system was simply a reflection of what was happening in the economy.
“It is not a question of just selling a house for selling a house’s sake,” he contended.
The banker insisted that BNB had in all cases where it was forced to sell the property of delinquent clients tried “very hard to at least match the price to the valuation”.
Moreover, he said BNB had even gone as far as to suggest to clients that had reached the unfortunate stage, to try to find a buyer on their own because the market was so challenging that getting a prospective buyer to pay market price was difficult.
“We have told some customers: ‘If you think you can get $600 000 for your house, you can try to get it.’
We have done some of that and we have continued to work with customers,” Howell said.