BoJ to discuss controversial charges with banks

Governor of the Bank of Jamaica, Brian Wynter, is expected to meet with the heads of local commercial banks next week, to discuss the findings of an investigation into the charges being applied by these banks.
The announcement was made by the Minister of Finance and the Public Service, Hon Audley Shaw, at a press conference at the Ministry, Friday November 19. Mr. Shaw ordered the study in September, following reports of banks charging customers to make deposits.
Mr. Shaw said Friday that he has received the report, and a meeting has been arranged for November 23 between the BoJ and the banks.
He also assured that the Government was not planning to use legislation to dictate lending and deposit rates to commercial banks. He pointed out that, while the BoJ has the authority under section 33 subsection 1 of the BoJ Act to determine the rates, this was not something the Government was keen on.
“The power that the Bank of Jamaica has to set both lending and deposit rates is already enshrined in law, but we believe that it is inconsistent with the market system and the market economy and, therefore, we are not going there. But I am saying, when I review that report which is now on my desk, we are going to use it as the basis to have a sit down and have a chat with the commercial banks,” he stated.
In relation to interest rates, the Finance Minister reiterated his calls for banks to play their part in ensuring economic growth, by further lowering these rates.
“Commercial banks need to step up to the plate more aggressively. Over the past week, two banks have reduced their rates by one and one and a half percent. Welcome! But gentlemen and ladies of the banks, you are not moving fast enough. I want you to move faster,” he urged.
He said his challenge also extended to lending agencies in the public sector, such as the Development Bank of Jamaica and the Ex-Im Bank, as Jamaica’s future growth relied on access to cheaper funds.