BOJ reports increase in credit to businesses, households


BOJ reports increase in credit to businesses, households

Friday, February 21, 2020

Print this page Email A Friend!

THE Bank of Jamaica (BOJ) is reporting a significant increase in credit extended by deposit-taking institutions to businesses and households for the 12-month period ending December 2019.

BOJ Governor Richard Byles said credit to businesses grew by 20.3 per cent, while the provision to households increased by 16.5 per cent.

“This growth was notably faster than the expansions of 15.4 per cent and 12 per cent in credit to businesses and households, respectively, which were recorded in 2018,” he pointed out.

He said, further, that the number of firms securing financing from the issue of corporate bonds and equity is “encouraging”.

The governor was addressing the quarterly media briefing at the BOJ's downtown Kingston headquarters, yesterday.

Byles said the buoyant growth in credit represents “stronger signs” that the Central Bank's accommodative monetary policy stance “has been bearing fruit”.

Accommodative monetary policy is where a central bank attempts to expand the overall money supply to boost the economy.

The bank has maintained the policy interest rate on overnight placements from deposit-taking institutions at 0.50 per cent as at yesterday, having incrementally reduced the figure from 3.25 per cent at the start of 2018.

The governor said the decision is based on the BOJ's assessment that monetary conditions continue to be “generally appropriate” to support inflation remaining within the target of four to six per cent over the next eight quarters.

The inflation target was set by the Government to facilitate a faster pace of economic growth while supporting Jamaica's ongoing debt-reduction strategy.

“In response, we have seen that the deposit-taking institutions — commercial banks, merchant banks and building societies — have recorded strong growth in loans as well as marked reductions in lending rates on local currency loans,” he pointed out.

Byles, who late last year expressed concern that the anticipated reductions in rates to the public from the policy rate adjustments had not been materialising at the desired level, indicated that he had several meetings with representatives of those institutions to discuss the issue.

He said those talks resulted in a significant boosting of credit being issued to businesses and households.

“Generally, new loans have been issued at rates that are better than and more competitive to previous loans issued,” he noted.

In terms of the impact on the growth numbers, the governor noted that while there was a fallout in mining and agriculture, there were marked increases in tourism and manufacturing, resulting in growth trending upwards from 1.1 per cent for the September 2018 quarter, to 1.4 per cent in the September 2019 quarter.


Now you can read the Jamaica Observer ePaper anytime, anywhere. The Jamaica Observer ePaper is available to you at home or at work, and is the same edition as the printed copy available at




1. We welcome reader comments on the top stories of the day. Some comments may be republished on the website or in the newspaper � email addresses will not be published.

2. Please understand that comments are moderated and it is not always possible to publish all that have been submitted. We will, however, try to publish comments that are representative of all received.

3. We ask that comments are civil and free of libellous or hateful material. Also please stick to the topic under discussion.

4. Please do not write in block capitals since this makes your comment hard to read.

5. Please don't use the comments to advertise. However, our advertising department can be more than accommodating if emailed:

6. If readers wish to report offensive comments, suggest a correction or share a story then please email:

7. Lastly, read our Terms and Conditions and Privacy Policy

comments powered by Disqus



Today's Cartoon

Click image to view full size editorial cartoon