Commercial banks in Barbados are pleading for an ease on the interest they are forced to pay customers, who have now accumulated more than $4 billion in savings.
The minimum deposit rate is the last remaining rate the Central Bank of Barbados insists commercial banks must pay their customers, but bankers want the regulation removed or adjusted.
The Central Bank has set the minimum interest on savings at 2.5 per cent. The other interest rate controlled is that at which commercial banks borrow from the regulating institution.
The bankers have been calling for a change for almost ten years now, and as recently as June 1, the bosses of the island’s five commercial banks appealed to Minister of Finance Chris Sinckler to do something about the minimum deposit rate because it was reducing their revenue margins in an already flat market for loans.
Barbados National Bank (BNB) managing director Derwin Howell told the DAILY NATION that fixing of this rate by the Central Bank was an unnecessary imposition.
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