Fixed interest

Rates on savings to remain near zero per cent, banker says

Barbadians should not expect any increases in interest rates on savings at commercial banks here anytime soon, one senior banker has warned.

Managing Director and Chief Executive Officer of Republic Bank (Barbados) Ltd Anthony Clerk said nothing had changed since the banks slashed interest rates to virtually zero nearly three years ago after the Central Bank ended the mandatory  minimum rate of 2.5 per cent in April 2015.

The banks reacted by lowering interest rates on deposits to between 0.01 per cent and 0.15 per cent, blaming an excessively liquid banking system.

“Market forces came into play in terms of determining the rate and the rate had in fact fallen. I think that those market forces are more or less the same as they were then. So unless there is some major change in those forces then the deposit rates are likely to remain at a low level,” Clerk told Barbados TODAY in a recent interview.

The decision to slash the rates prompted accusations that the commercial banks were profiteering, given the range of fees associated with various accounts and transactions.

Among those pointing an accusing finger was Horace Cobham, the former head of the Barbados Bankers’ Association, who had said the commercial banks had “lowered lending rates, but not to the same extent they have lowered deposit rates. So their profit margins have increased”.

However, Clerk said there was no truth to the charges, arguing that the banks spend hundreds of thousands of dollars on social causes each year, using Republic’s own involvement in Crop Over as an example.

“Our corporate social responsibility is something we are paying attention to . . . . So it is not just about profit, it is about building and supporting the communities in which we operate,” Clerk insisted, adding that the bank spent approximately $400,000 last year and planned to spend a similar amount in the current financial year in support of various activities.

8 Responses to Fixed interest

  1. Sheron Inniss March 7, 2018 at 6:25 am

    Depositors remove your money from the banks. You have other options. Wake up and smell the coffee.

  2. Dick Tracy March 7, 2018 at 10:34 am

    Legalized robbers! First responsibility is to depositors, not charitable causes. etc.

  3. Janice Ifill March 7, 2018 at 12:35 pm

    What about the 5.00 now Republic bank taking out the account for maintenance fee.

  4. Charlie Sixteen March 7, 2018 at 1:13 pm

    Psycologicaly gamed propoganda

  5. Job March 7, 2018 at 2:27 pm

    I remain at a loss why the Central Bank does not reign in the commercial banks and their unjustified charges. The consumers continue to be the scapegoats for their unscrupulous behaviour; most would be surprised at the quantum of salaries and bonuses paid annually to the bank managers. I am afraid that greed has taken root and is allowed to thrive at the public’s expense. Let us have legislation to arrest/ address? Banking seems to be one industry where market forces hardly benefit the consumer.

  6. seagul March 7, 2018 at 3:05 pm

    Bankers are the most corrupt and profitable entity worldwide. Secrecy and manipulation at its best since the start of capitalism.
    Some people got hopes and dreams.
    Some people got ways and means.
    How can you be sitting there
    Telling me that you care…Tellers

  7. seagul March 7, 2018 at 3:25 pm

    We remain at a loss when BT bias censuring continues.

  8. Belfast March 7, 2018 at 5:54 pm

    Is this the same bank which recently bragged of its $100 million profit? and a few days later notified its suckers that there was going to be an increase in banking charges.
    Bandits used to stick up banks, now the banks are sticking up their customers.


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