Pensioners in Guyana

BBCI Toll Reductions

– huge blow for NIS, GAWU, GuySuCo

Bondholders of the Berbice Bridge Company Inc (BBCI) are coming under pressure to accept the lowering of interest rates and the significant extension of the repayment period on their investment in order to facilitate the reduction of tolls to cross the Berbice River Bridge.

The Guyana Times understands that the bondholders were invited to a special meeting scheduled for December 14 to discuss matters concerning Government’s intention to reduce the Berbice River Bridge toll.

NIS Head office, Georgetown

During that meeting, the bondholders will have to decide whether or not they will agree to the requested requirements, which would facilitate the fulfilment of the A Partnership for National Unity/Alliance For Change (APNU/AFC) coalition’s campaign promise of the toll reductions.

The bondholders had invested millions of dollars in Corporate Bonds Tranche 1 and Tranche 2 instruments.

The BBCI is asking that the bondholders approve the interest rates applicable to the bonds being reduced from nine per cent (Tranche 1) and 10 per cent (Tranche 2) per annum respectively, to a fixed 7.5 per cent per year.

Additionally, the BBCI is asking that the bondholders approve the extension of the repayment periods and schedule of repayments   of Bond Tranche 1 and 2 to an additional three and four years respectively, in equal semi-annual payments.

The bondholders are the New Building Society Limited (NBS); the National Insurance Scheme (NIS); Republic Bank Limited; the Guyana Bank for Trade and Industry (GBTI); Scotiabank; Citizens Bank; the NEW GPC INC; Trust Company Guyana Limited; Hand- in-Hand Trust; Guyana Sugar Corporation Pension; Guyana Power and Light Pension; Guyana Agricultural and General Workers Union (GAWU) Pension; Guyana Geology and Mines Pension; Demerara Bank Limited; Demerara Distillers Limited Pension; Massy Pension and Geddes Granger Pension.

Should these bondholders agree to the requests being made by the Bridge Company, they would be losing significantly on their multimillion-dollar investments in the Company.

On the other hand, should they refuse, the toll reductions will take much longer to be implemented.

Even though GuySuCo was declared “insolvent” and allegedly not in a position to pay workers their earned Annual Production Incentive (API), its pension fund for sugar workers – $281 million – will also be receiving lower returns, as well as GAWU’s $81 million.

On November 16, Public Infrastructure Minister David Patterson had announced that from December 1, the tolls to cross the Bridge would be reduced; however, this did not materialise.

In a press release, the Public Infrastructure Ministry explained that an agreement was still being brokered with the Berbice Bridge Company.

The Ministry said it has submitted a draft agreement to BBCI for review, in relation to toll reductions. Thereafter, another copy of the proposed agreement was sent to BBCI on November 30. The document is currently engaging the attention of BBCI’s lawyers, the Ministry reported.

It went on to say that once it received a favourable response from the Bridge Company, the $40 million subvention would be available for immediate release and the tolls would be immediately implemented once the agreement was signed.

However, following the resignation of the NEW GPC and Queens Atlantic Investment Inc representatives from the Board of Directors of the BBCI, Government now has the majority of seats on the Board. This simply means that it can move ahead with the toll reductions by simply putting the matter to a vote.