Jamaica Bankers Association President Nigel Holness speaking at CIBC First Caribbean International Bank’s Client Appreciation Reception at the Jamaica Pegasus Hotel in New Kingston last Thursday.

The Jamaica Bankers Association (JBA) has recommended that the Government consider lower Jamaican dollar reserve requirements to facilitate further decreases in interest rates.

According to JBA president Nigel Holness, the lowering of the reserve requirement would release much-needed Jamaican dollar liquidity into the lending pool for productive loans, thus having a direct impact on the cost of funds and would allow banks to offer lower interest rates to their customers.

Holness, who is also managing director of CIBC FirstCaribbean International Bank, was responding to calls by Finance Minister Audley Shaw for local banks to offer lower interest rates to their customers.

“Over the past year interest rates have fallen significantly to single digits, including mortgage rates, corporate rates and consumer credit rates,” Holness said in an address at CIBC’s Client Appreciation Reception at the Jamaica Pegasus Hotel in New Kingston last Thursday.

“The minister keeps talking about lower rates. He can certainly assist the sector and help the country in achieving increased growth by encouraging the Bank of Jamaica (BOJ) to lower the cash reserves on Jamaican dollar-prescribed liabilities. This would create the right environment for rates to go even lower,” Holness argued.

http://www.jamaicaobserver.com/news/bankers-association-counters-shaw-on-interest-rates_111868