The Monetary Policy Regime and Banking Spreads in Barbados

September 1, 2006

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Format: Chicago

Laura Valderrama, and Wendell A. Samuel The Monetary Policy Regime and Banking Spreads in Barbados, (USA: International Monetary Fund, 2006) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The paper analyzes the determinants of banking spreads in Barbados, with a view to identifying the role of the monetary policy regime in explaining high spreads. The paper finds that interest rate spreads for Barbados are higher than would be suggested by its macroeconomic performance. Banking concentration and bank-specific variables, including bank size and provisions for nonperforming loans, do not have an important role in explaining variations in bank spreads. Rather, it appears that monetary policy variables, such as reserve requirements and capital controls, are the most important determinants of spreads.

Subject: Bank credit, Banking, Commercial banks, Credit ratings, Deposit rates

Keywords: Bank, Barbados, Commercial bank, Rate, WP

Publication Details

Pages:

24
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2006/211
Stock No:

WPIEA2006211
ISBN:

9781451864717
ISSN:

1018-5941

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