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Central Bank of Barbados will no longer set a Minimum Rate on Savings Deposits
The Central Bank of Barbados today announced that effective April 21, 2015 it will no longer stipulate a minimum rate of interest on savings deposits at commercial banks. Banks may determine the rate to be paid on savings accounts in light of market conditions, in the same way that they now do for all other interest rates.
The legal notice of this change appears in the Official Gazette of today’s date (April 7), and commercial banks are obliged to provide customers one month's notice before they may alter the existing rate.
With this decision the Central Bank has completed the process of dismantling a regime of structured interest rates on loans and deposits which dates back to the Bank's earliest days, and it allows commercial banks to set savings deposit rates in line with other deposit rates and with loan rates and rates on mortgages.
Barbados now joins advanced economies and two other Caribbean countries, Jamaica and Trinidad and Tobago that offer guidance on interest rates fully through the Central Bank's activity in the financial market, rather than by way of interest rate stipulations.
April 7, 2015