Development Bank of Jamaica

Target sectors

The DBJ will finance development projects in the following established sectors:

1. Tourism (attractions, accommodations, health tourism, eco-tourism)
2. Agriculture and Agro-processing/Agri-business
3. Manufacturing
4. Mining
5. Infrastructure & related services (Power, water, sewage etc)
6. Energy/ alternative energy solutions
7. Information and communications technology

Project eligibility

Each project must be able to demonstrate a net economic benefit to the country through any combination of the following general development criteria:

• Employment creation
• Foreign exchange earnings or savings
• Facilitation and/or stimulation of foreign direct investments
• Expansion of export capacity
• Diversification of an existing industry
• Utilisation of local inputs
• Demonstrate long-term financial viability
• Demonstrate the ability to repay DBJ’s loan
• Lead to development of management skills and technological know-how
• Indicate strong market demand for their products and/or services
• Demonstrate the ability to meet projected demand targets
• To demonstrate that its operations have no adverse effects on the environment.
• Capital will constitute no more than 20% of DBJ’s loan.
• Unless it forms part of a development project, the DBJ will not lend money for refinancing and land acquisition. In the case of land acquisition, the DBJ will only provide financing of up to 10% of DBJ’s agreed loan amount .

Company qualification criteria

In addition to achieving project eligibility, it is important for the company to possess the following characteristics:

• Be registered and operating in Jamaica
• Have majority Jamaican ownership (up to 75%). However, Well-documented exceptions could be made however, to allow for the consideration of projects that represent a compelling case for national development.
• Not be sole proprietorship
• Demonstrate sound management practices and capability
• Be current with all statutory deduction payments evidenced by a Tax Compliance Certificate (TCC)
• Be current with property taxes , where applicable
• Disclose all its associated companies and subsidiaries
• Possess effective internal operational control systems

Loan limits

• The minimum limit for direct lending is J$50M (or US$ equivalent) per project.
• The maximum limit for direct lending is J$500M (or US$ equivalent) for any one project, company or group. (The limits applicable to a project are expanded to a company or group of companies, where a group of companies would be defined to include companies with common ultimate shareholders holding in excess of 70% of their equity).
• If DBJ is the sole lender, the Bank will lend a maximum of 70% of the overall project cost.
• Where projects are co-financed or DBJ participates in a syndication the DBJ will lend a maximum of 65% of the project cost not financed by other financial institutions.
• Stakeholder’s equity must be no less than 30% of the total project cost.
• DBJ will not accept sweat equity as part of a company’s contribution to the cost of the project.

Collateral

Direct loans must be fully secured. The collateral coverage ratio (collateral value:loan balance) must be at least 1:1. The DBJ will require all direct loans to be secured by any combination of the following securities:

• Debentures supported by any or all of the collateral items listed below:
  • Mortgages over real property
  • Bills of sale over equipment and other fixed assets
  • Assignment of leases, contract revenues, shares, and insurance policies
  • Personal guarantees of the principals
  • Hypothecation of cash

Where the DBJ co-finances a project or participates in syndicated lending, the DBJ must share a first charge on the relevant collateral on a pari-passu basis with the other lenders.