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PRESS RELEASE: BRIDGETOWN, BARBADOS — {23 May 2018} — KPMG is pleased to release its 14th annual Caribbean Hospitality Financing Survey highlighting financing trends in the region’s hospitality and tourism industry and the outlook for the future of the industry.

The survey has been designed to provide banks, non-banks and financiers with a better understanding of the profile and recovery performance within the Caribbean region.

The major event since our last survey was the catastrophic 2017 hurricane season which had a devastating impact on many countries in the region. It was therefore, with some trepidation that we approached financiers of tourism projects in the region. We were pleasantly surprised, and relieved, to find remarkably high levels of confidence in Caribbean tourism amongst financiers. Confidence levels for banks increased for an astonishing ninth year in a row and the confidence levels of non-banks (private equity, family offices etc.) were even higher. However, lessons have been learned. Financiers will be scrutinizing insurance coverage and quality of construction more intensely than they did prior to Irma and Maria.

Some of the key findings of the survey include:

—   Confidence levels of banks and non-banks have increased despite the impact of hurricanes;

—   Financiers’ appetite for issuing senior debt not just for expansions and renovations but acquisitions;

—   The quality of construction will receive more attention and adherence to codes of construction will be non-negotiable;

—   An increasing number of financiers are willing to consider new builds;

—   Half of the banks and 57% of non-banks think the economy is approaching the peak;

—   The issue of insurance, the adequacy of coverage and the approach taken by insurers received a lot of attention; and

—   The critical issues impacting financing activity in the region.

Christopher Brome, Partner, Advisory of KPMG in Barbados and the Eastern Caribbean stated, “It’s a positive sign to see financiers are willing to lend funds to assist the Caribbean with recovery. Although cautious due to concerns surrounding adequate insurance coverage and the need for construction reform, it’s encouraging to see their confidence levels are high.