D.B.S. underwent the “most challenging” financial year 2019-2020
The Development Bank of Samoa underwent the “most challenging” financial year 2019-2020.
This is outlined in its latest annual report.
“The year under review will go on record as one of the most challenging year for the Bank, on the back of two Health crisis - the measles outbreak in late 2019 and now the global pandemic in 2020, “Covid19”.
“The financial impact of Covid19 has been felt by all businesses that are clients of the DBS, in particular the tourism sector that accounts for 67 percent of the loan portfolio.
“The Bank’s significant exposure to the tourism sector and the effects of SOE restrictions is reflected in the lending and performance outcomes for the year,” said Chairman of the D.B.S. Board, Leasiosiofaasisina Oscar Malielegaoi.
He said the new approved loans of 358 in number and valued at $6.8million are consistent with the budget.
“However, total new loans declined when compared to FY2019 by 32 percent in number and 22 percent by value.
“The stimulus package received from Government of $2million to cover interest relief and rent for private tenants over three months, provided short-term funding cover for shortfalls in revenues for the said period,” said Leasiosio who is also the Chief Executive Officer for the Ministry of Finance.
According to the report, despite the challenges of Covid19, DBS recorded a surplus of $1.1million from operation compared to budgeted loss of $1.1million and surplus of $664,000 in the previous FY2019.
“The overall loss before tax of $444,000 for the year was an improvement when compared to budgeted loss of $2.6million and last FY2019 loss of $683,000.
“The prolonged period to realise non-performing loans and the uncertainty of Covid19 will continue to challenge the Institution’s financial sustainability.
“The DBS however remains steadfast that appropriate measures are in place to effectively manage and sustain operation into the next twelve months. The Government has also given its assurance to support the Bank’s operations through future capital injection.
Navigating the road ahead is difficult and challenging.
“However, I am convinced that the Bank is taking the right approach towards strengthening the resilience of its operations in the coming years.
I commend the Directors for their contribution and support, and applaud Management and Staff for the hard work and commitment through these challenging times to deliver the outcomes of FY2020,” said Leasiosio.