By VERNON CLEMENT JONES, Guardian Business Editor, vernon@nasguard.com

The Bahamas Development Bank is expressing the almost unheard of willingness to foreclose on the property of deadbeat borrowers, now representing more than 50 percent of its book.

"In many instances, borrowers with the ability to pay have simply refused to honor their commitments," said Chairman Darron Cash at a news conference Friday. "For various reasons, certain borrowers have been viewed and treated as 'untouchable'.

"Management has been advised to vigorously pursue every collection option at its disposal: There are no sacred cows; there are no untouchables."

It's a no-nonsense stance likely borne out of a startling growth in the number of bad accounts. According to the institution's 2007 annual report, 51 percent of its loans were non-performing. The problem appears to have only deepened over the first four months of this year, with a Guardian Business source suggesting 54 percent are now 90 days past due.

What it adds up to is a quasi-governmental lender owed more than $30 million by borrowers who may have little intention of paying it back.

Cash doesn't necessarily hold that pessimistic point of view. Last Friday, he announced an extensive public awareness campaign designed to bring those delinquent borrowers into the bank with an offer to settle their accounts or make arrangements to do so. The media blitz coincides with a grace period, ending May 30, after which Cash's steamroller gets set in motion.

Through the combined efforts of its in-house staff and those of professional collection agencies, the institution will then target the more than 600 clients, most small business owners, with the threat of seizing property at the center of its arsenal.

The bank's past willingness to accept highly portable and depreciable equipment as collateral means it may find itself in court for a significant number of its cases, seeking liens on corporate as well as real property.

Still, for those who show a willingness to work with the bank, coming in during the grace period, his institution is prepared to demonstrate real flexibility, said Managing Director Calvin Knowles.

"Let me repeat: This is not a witch hunt," he said Friday.

While commercial banks have only begun to make a show of bankrolling Bahamian small business, Knowles's institution was, in part, formed to fill the void they've historically been unwilling to fill.

Its proactive stance has led to hundreds of success stories for working class Bahamians. Most of them have been similarly successful in paying back their benefactor.

Still, the problem of delinquency persists — something Knowles inherited when he took up his post last year.

"I am trying to reverse the trend," he said.

Part of that strategy has been to make it more difficult to get a loan through his institution in the first place.

But that lending will continue despite the onerous level of delinquency and its very real impact on the bank's bottom line, said Knowles, pointing to the institution's $25 million subvention for the current fiscal year.