NASSAU, BAHAMAS — Lending conditions across The Bahamas strengthened in the first half of 2025, with total loan applications rising 11.5 percent as commercial banks reported increased credit demand and higher approval rates, according to the Central Bank’s June 2025 Quarterly Bank Lending Conditions Survey.
The survey, which provides insight into private sector credit demand, showed that banks received 19,081 applications over the six-month period, a marked improvement over the 2024 comparative period. Of these, 15,648 loans were approved, reflecting a robust approval rate of 82.0 percent. Loan denials declined by 4.2 percent, with the top reasons cited as miscellaneous factors, high debt service ratios, and delinquency in prior loans.
Consumer lending remained the dominant category, accounting for 94.4 percent of total applications. Requests strengthened 14.8 percent year-on-year, with growth recorded across New Providence (12.3 percent), Grand Bahama (28.8 percent), and the Family Islands (25.4 percent). The main drivers included miscellaneous personal purposes (33.1 percent), credit cards (22.6 percent), debt consolidation (17.2 percent), private vehicles (10 percent), and travel-related loans (9.5 percent).
Demand for specific categories also saw significant increases, including commercial vehicles (90.0 percent), other miscellaneous purposes (45.6 percent), private cars (30.9 percent), and land purchases (26.9 percent). In contrast, applications declined for travel (6.8 percent), education (8.1 percent), and debt consolidation (17.5 percent).
The mortgage sector showed mixed outcomes, with 695 residential applications received—down 12.4 percent year-on-year, though less severe than the 25.5 percent decline seen in 2024. Financing requests for existing dwellings rose 60.5 percent, while applications for renovations and additions plummeted 94.9 percent. Total mortgage approvals stood at 53.9 percent, with renovation projects approved at 56.3 percent and new construction at 69.9 percent. Mortgage denials totaled 7.6 percent, largely due to miscellaneous factors (45.3 percent) and high debt service ratios (24.5 percent).
Commercial financing applications fell sharply by 41.3 percent to 364, reversing the 18.3 percent growth of the prior year. Approval rates for commercial loans decreased to 88.5 percent, with New Providence applicants enjoying a 90.3 percent approval rate, while only 33.3 percent of Grand Bahama requests were approved. Denials were primarily due to unclassified factors, inability to verify income, lack of collateral, and high debt service ratios.
