Turks and Caicos Islands government and Royal Bank of Canada officials at the signing of the new loan agreement
PROVIDENCIALES, TCI -- The Turks and Caicos Islands (TCI) government on Wednesday signed a new $28 million loan agreement with the Royal Bank of Canada (RBC) to complete repayment of the $170 million bond guaranteed by Britain.
The balance of the bond will be repaid from a sinking fund and other TCI government cash resources. The bond is due to be repaid on February 22, 2016.
RBC provided the most competitive proposal following the government’s request for financing proposals in September 2015. The terms of the new loan are very attractive with interest at just 1.2% over LIBOR. It will be repaid in quarterly installments with the final payment being due in 2019, although the government may also repay the loan early without penalty. It was not necessary to request a loan guarantee from the UK.
"The TCI economy has seen a major turnaround over the past three years and, with its BBB+ credit rating, 4.3% GDP growth and consecutive budget surpluses, this will allow the government to retire its $170 million UK guaranteed debt. This is a major accomplishment for this government and all involved, and now we can invest in the socio-economic development of our people and country to a greater magnitude and pace. This is indeed a proud moment for the Turks and Caicos Islands," said Premier Dr Rufus Ewing.
“This is the final piece of the jigsaw in the refinancing of our UK guaranteed debt taken out in 2011. The competitive terms achieved are a testament to the progress we’ve made. We are grateful to RBC Royal Bank for their commitment to TCI at this important stage in our recovery and we look forward to working with the bank as we build on this platform,” said minister of finance, Washington Misick.
“RBC is extremely proud to partner with The Turks and Caicos Islands government with respect to this historic transaction and we look forward to exploring future opportunities,” said Brian Knowles, vice president corporate banking, RBC.
Governor Peter Beckingham also welcomed the agreement with RBC, saying: “The signature of this agreement is a milestone for TCI. Repayment of the $170 million bond will mark the end of the loan guarantee provided by the UK government when TCI's finances were in poor shape, and another step on the country's move to a strong and resilient economy. I would like to pay tribute to everyone in government, the House of Assembly, the public service and the private sector who have contributed to this achievement, as well a range of special advisers and the chief financial officer from the UK. As the London Times is planning to bill in a special report on TCI next month, it is a major economic turnaround of which the whole country should be proud."