The National Insurance Service (NIS) provides loans to statutory bodies such as VINLEC (St. Vincent Electricity Services Limited), CWSA (Central Water and Sewerage Authority), and the National Lottery.
This was disclosed on Sunday by CEO Stuart Haynes. Haynes said these loans are categorised by the NIS as “impact investments”, which aim to generate a financial return while also driving social and economic utility for the country.
The NIS participated in financing for VINLEC to support the development of their generation plants. This was done through loan syndication, where the NIS partnered with the Bank of St. Vincent and the Grenadines. The CEO viewed this as a contribution to improving the country’s electrical infrastructure.
The NIS has “on-lent” funds to the CWSA. These funds were designated for the development of capital projects. Similar to the VINLEC arrangement, the NIS views this as a contribution toward economic development.
In the case of the National Lottery, the institution has borrowed funds from the NIS specifically to assist with the upgrading of playing fields and the development of sports and culture.
The CEO mentioned a recent loan facility of $7 million, of which the Lottery had drawn down $2 million at the time of the interview. The interest rate on this loan is 6.5%. Haynes noted that the National Lottery has serviced its loans (this being the second one) “on time and in full”.
While the NIS lends directly to these statutory bodies, Haynes clarified that for private sector projects, the NIS generally prefers to partner with the Bank of St. Vincent rather than lending directly. “They may place a special deposit at the bank to be on-lent to private entities to ensure proper risk management”.
Regarding the statutory bodies, Haynes emphasized that these loans are subject to rigorous due diligence. “The entities must pass tests regarding their capacity to pay to ensure the safety of the NIS funds”.
