From $46,153,731 in fiscal year 2009, CDA’s assets grew to $46,812,843 in the last fiscal year.
Of this total net assets of the agency, $8.75 million in assets were in the CDA’s Development Banking Division; $18.98 million, CDA’s Development Corporation Division; and $19.08 million, Northern Marianas Housing Corp.
CDA’s non-current assets increased by $594,127 from $12.42 million in FY’09 to $12.85 million in FY’10.
Accounting for the increase in non-current assets for FY’10 were the net loans receivable or amounts owed by borrowers totaling $594,816. There was no entry in the books for loans receivable for FY’09.
CDA’s Development Corp. Division had a net of $12.20 million in loans receivable as of Sept. 20, 2010, a 5 percent decrease from its 2009 level of $12.86 million.
The audit stated that the $653,935 drop in loans receivable was attributed to CDA’s ramping up its collection efforts in 2010 and its more accurate analysis of loan collateral values.
On the contrary, for FY’09, no new loans coupled with normal principal reduction through scheduled payments resulted in the $331,757 decrease in loans receivable compared to FY’08 level.
Of the $12.85 million in total non-current assets, $2.63 million came from the Development Banking Division; $8.55 million, DCD; $1.67 million, NMHC.
CDA had $2.6 million in FY’10 for foreclosed real estate assets, a slight increase from its FY’09 level of $2.59 million.
It also recorded $9.65 million in land in the last fiscal year, which decreased slightly compared to FY’09’s $9.75 million.
NMHC had $11.796 million invested in capital assets in FY’10 while DCD had $2.07 million.
CDA’s liabilities rose in FY’10 from $9.589 million in FY’09 to $9.978 million.
Broken down into divisions, the liabilities were $1.25 million, DBD; $1.26 million, DCD; and $7.46 million, NMHC.
As of Sept. 30, 2010, CDA’s Development Corporation Division’s portfolio’s net value after recoveries was $12.2 million in FY’10 and $12.86 million in FY’09.
There was $550,526 in total recoveries last fiscal year as opposed to recorded $796,207 in bad debts for FY’09.
DBD recorded $2.6 million in recoveries last fiscal year and $290,200 in bad debt expense for 2009.
According to the audit, more loans had been returned to non-delinquent status through the efforts of the loan department and more accurate valuation of collateral backing the loans.
CDA touted its debt relief program in 2010 that allowed the borrowers to restructure their delinquent loans at 2%, setting aside the accrued interest for the new loan to be fully amortized.
Currently, there are 43 borrowers in the debt relief availing of the 2 percent interest rate with extended terms, according to CDA.
The agency stated in an earlier interview that it is eyeing to transfer up to 40 more borrowers into the program in the next two years.
The debt relief program is helping the borrowers settle their loans and it also aids CDA in preserving its core principal, CDA said.
In FY’10, interest and fees earned on loans for DCD decreased 86 percent or $2.6 million because of the change in method used to record interest on loans to recognize only interest earned up to 120 days for delinquent loans.
As of the current fiscal year, 40 percent of the $30 million in total loans are good loans with $8 million in judgment loans.
As of FY’11, to stay in the black, CDA follows a two-pronged approach — intensifying collections and reducing expenses.
Total operating expenses decreased for FY’10 from $10.11 million in 2009 to $9.74 million.
For FY’10, CDA-DCD’s operating expenses rose by 24 percent or $229,629, save for the provisions for loan guaranty and foreclosed real estate.
DBD’s expenses, meanwhile, dropped by 94 percent or 156,386 due to lack of expense reimbursements paid to DCD to cover shared costs.
While the audit noted a decrease in DBD’s investments for FY’10 as its invested funds dropped 58 percent from $7.68 million in 2009 to $3.26 million in 2010 with earnings on these expenses decreasing by $79,551, DCD’s invested funds increased by $5,928. However, DCD’s related earnings decreased 78 percent or 46,626 less from $60,015 to $13,389.
In 2009, the agency reported a $1.26 million in total losses; however, it showed resurgence the following year with a $270,177 income.
Of the $1.26 million in 2009, $862,972 were the transfers for capital development grants that reduced to $377,993 in FY’10.
While the audit showed $400,874 in losses before transfers in 2009, CDA had $648,170 in income for 2010.
Moreover, the auditor, Deloitte & Touche LLC performed tests that revealed no instances of noncompliance of the agency. There were no unresolved audits from prior year audits of CDA either.