ECCB pens letter to managers of all commericial banks about impact of increases in bank fees

The Eastern Caribbean Central Bank (ECCB) has written to the managers of all commercial banks in the Eastern Caribbean Currency Union (ECCU) reiterating its concern about increasing bank fees and the impact on the ECCU public.

In a letter dated November 4, 2016, deputy governor Trevor Brathwaite said in an effort to address the issue of increasing fees and charges, the ECCB Monetary Council approved “short,{{more}} medium and long term recommendations related to bank fees and charges and agreed to reduce the minimum savings rate (MSR) from 3.0 per cent to 2.0 per cent effective May 2015.

“The reduction in the MSR was expected to translate into a reduction in banks’ cost of funds and contribute to improved financial performance. Furthermore, it was envisioned that the strategy would strengthen the financial sector and stimulate broad-based sustainable growth, essential to the overall development of the ECCU,” the release said.

“The Council recognises that the expected results from the reduction in the MSR were not attained and banks were passing various costs to their customers through subsequent increases in bank fees. This action is of great concern to the Council, especially given the public outcry throughout the ECCU. The action also prompted the establishment of the ECCU Working Group on Commercial banks’ fees and charges in June 2016, to review bank fees and charges across the ECCU.

“The Council reiterates its concern about increasing bank fees and the impact on the ECCU public,” the release said.