Venture fund chairman: 62% have stopped making loan payments

The Bahamas Entrepreneurial Venture Fund (BEVF) has found that 62 percent of its debt-financing portfolio decided in the midst of the pandemic to stop making loan payments, BEVF Chairman Michael Cunningham said Friday.

Cunningham, who was a speaker at Friday’s Bahamas Business Outlook, explained that while some companies have had to shutter in order to stop the leakage of cash in the midst of the pandemic, many more than had been expected have made it this far.

“The number of companies that are still in business today, that were impacted by the pandemic, are much more than many thought would survive up to this point,” Cunningham said. 

“The pandemic has also brought about opportunities for new ventures,” he added.

While the BEVF found that some of the companies in its portfolio have diversified their operations in order to stay afloat and are paying back their loans – about 15 percent – Cunningham said 23 percent requested payment deferrals while 62 percent have gone dark.

According to Cunningham, loan repayment sizes shrunk last year. He explained that for every dollar the BEVF was to receive in repayment before the pandemic, during the pandemic period “we received less than 84 cents”.

“We are encouraging all companies to start repaying their loans if in a position to do so,” said Cunningham.

“If not in a position to do so, the fund will make arrangements to have your loan restructured in order for you to survive or to stay in your operation.”

He explained that companies entering into a funding arrangement with the BEVF are required to have a disaster recovery plan, especially after the damaging effects of Hurricane Dorian and COVID-19 to businesses.

He also added that family island entrepreneurs are encouraged to take advantage of opportunities on their islands, “especially the islands where large infrastructure development is taking place”.

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source https://thenassauguardian.com/venture-fund-chairman-62-have-stopped-making-loan-payments/