Interest Rate Spreads in the Eastern Caribbean

Ruby Randall

No 1998/059, IMF Working Papers from International Monetary Fund

Abstract: This paper examines interest rate spreads in the Eastern Caribbean and seeks to explain why they are persistently high by comparison with other low-inflation countries. The paper concludes that operating costs appear to be a key determinant of observed interest rate spreads, giving rise to the policy recommendation that efforts to expand the market size of efficient banks might help pave the way for greater efficiency.

Keywords: WP; interest rate; commercial bank; ECCB; Eastern Caribbean; interest rate spreads; commercial bank costs; return on assets; banking industry; ECCB area; bank interest; ECCB aggregate; ECCB rate; overdraft rate; ECCB loan loss; ECCB interest rate; marginal revenue; bank interest rate spread; United States interest rate; Commercial banks; Deposit rates; Loans; Loan loss provisions; Personal income; Caribbean (search for similar items in EconPapers)
Pages: 39
Date: 1998-04-01
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Citations: View citations in EconPapers (20)

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