Bank savings up, borrowing still flat
The local banking sector continues to show signs of increase in individual savings, but corporate borrowing remains flat.
President of the Barbados Bankers’ Association, Glyne Harrison, told Barbados TODAY not much has changed over the past year, as he gave an update on the commercial banking sector here.
He said it seemed residents were trying to save a bit more as they remained uncertain about the future while companies were drawing back on their borrowing and opting to do overdrafts instead as they too remain cautious.
“On the personal side we are seeing that things are, in terms of from the borrowing perspective, that the consumers are still not out there borrowing fully again. There is still a tendency towards the home-ownership route so people are still out there looking for home ownership. The uptake is not as quick as it used to be before but persons are still very much interested,” reported Harrison.
“On the corporate side we are seeing, in terms of business borrowing, that is definitely flat. There is not a lot of business borrowing going on. We are seeing that persons are utilizing overdraft,” he said.
Harrison said, however, overdrafts have not reached any worrying levels but the commercial banks were definitely keeping tabs.
“We are not seeing the trend as yet where we are worried that businesses are not revolving overdraft etcetera, but the business climate is one that has been flat and remains flat over the last year or so,” he added.
His assessment comes a week after a release from the Central Bank of Barbados and the Financial Services Commission (FSC) that the domestic financial system remains robust.
Harrison said while individuals continued to be in “a sort of watch and watch” mode, and although they were generally saving more there was increased activities with credit cards. This, he said, commercial banks were also monitoring.
“We are seeing on the credit card side that there has been some increased usage and that is something we have to keep an eye on to make sure that the increase usage doesn’t turn into non-performing credit cards, where cards become delinquent etcetera,” he added.