In other financial news, a review of this month's financial aggregates from the Central Bank shows a significant development in banking circles. It records a loan of $50 million from the Belize Bank to the DFC made in the last week of June.
Governor of the Central Bank Sydney Campbell today told us what is recorded as $50 million loan is a transaction for the Belize Bank to buy over DFC's loan portfolio. As has been reported, government has been trying to divest half of DFC's $300 million portfolio to ease the acute pressure that the insolvent DFC puts on its finances. A review of the prospectus shows that DFC is trying to sell off $146,584,50 in assets. But, full of many dubious debts, those assets aren't exactly blue chip investments and doubters have long been speculating that government would be lucky to get even one third the value of the portfolio.
Well, if the Belize Bank is negotiating for $50 million that works out to just about 30 cents on the dollar. Still at this point we don't know if the Belize Bank hopes to buy the entire portfolio and Campbell stressed that there are ongoing discussions between Belize Bank and government over the final value of DFC's portfolio. Remarkably one month after the transaction was recorded in the aggregates, Campbell says that the $50 million is, "on the books", but it has not yet been transferred as negotiations over a "true valuation" of the DFC's assets continue. As to why a portfolio buyout is recorded in the aggregates as a loan? Well, we still can't quite figure that one out.