Culturama Committee To Add Kaiso Tents To festival Line-Up by LK Hewlett
Effective May 1, 2015, the minimum rate interest on savings deposits for commercial banks in the Eastern Caribbean Currency Union member states will drop to 2%. It will affect banking consumers in St. Lucia, Antigua and Barbuda, Dominica, St. Vincent and the Grenadines, Grenada, St. Kitts and Nevis, Anguilla and Montserrat. The decision to lower the rate from 3% to 2% was made by the ECCB Monetary Council when they met in St. Kitts on February 24, however the effective date was only announced last night (Apr 14). It came by way of Council Chairman Hon. Ralph Gonsalves’ address on the state of the region’s financial and banking sector. He explained why the Council took the decision at this time. “Our banking system has a lot of money -excess liquidity- yet credit to the private sector (new loans) is declining,” he said. “Last year, despite the fact that the banks had excess liquidity, credit declined by 4.5 per cent. Declining credit to the private sector makes economic recovery slower. This situation has to change.” Chairman Gonsalves said as a result of the Monetary Council’s decision to lower the minimum deposit rate, the banks in the Currency Union will have a lower cost profile. “Combined with the economic recovery taking place in our economies, we expect to see banks start lending more to the private sector.” The lowered savings interest rate should result in a lowering of interest rates in commercial banks, namely business loans and home mortgages, Gonsalves opined. “We expect to see businesses pay lower interest rates on loans provided by our commercial banks. We are especially keen to see lower interest rates for all export-oriented firms. We would also like to see interest rates on mortgages continue to fall so that more of our people can afford to own a home. We are especially keen to see lower interest rates for all export-oriented firms. We would also like to see interest rates on mortgages continue to fall so that more of our people can afford to own a home.” Hon. Gonsalves pointed out that notwithstanding the drop in the savings deposit interest rate, , the region’s rate remains higher than that in Trinidad and Tobago which is 0.2 per cent; Canada – 1.0 per cent; and the USA, less than 1.0 per cent.
