Growth in private sector credit – BOJ governor
KINGSTON, Jamaica (JIS) — Bank of Jamaica (BOJ) Governor Brian Wynter says commercial bank credit to the private sector continues to grow steadily.
He said provision of credit for the 12-month period ending September 2016, increased by 14.3 per cent, relative to the 7.8 per cent for the corresponding period last year.
Wynter said that this reflected strong credit growth of 12.2 per cent for 2016, as against 5.9 per cent last year.
He was speaking at the central bank’s quarterly media briefing at the BOJ auditorium in downtown Kingston on Monday.
Wynter said the expansion of credit brought the ratio of private-sector credit to the gross domestic product (GDP), as at September 2016 to 24 per cent, up from 22 per cent last year.
This, he pointed out, represented an increase in loans to individuals and businesses.
“In particular, business loans expanded by 14 per cent relative to 8.1 per cent for September 2015. We have noted the positive role that innovations, such as the credit bureaus, are making in this regard,” he added.
Meanwhile, Wynter is projecting stronger medium-term economic growth based on the recovery of key industries and higher foreign and domestic investments.
This forecast comes against the background of accelerated second-quarter real sector growth of 2.3 per cent recorded for the July to September 2016 period.
In noting that conditions in the real sector continue to “evolve favourably”, Wynter said the anticipated medium-term growth is expected to be reflected by strong foreign direct investment inflows and continued increased credit provisions to the private sector.
Finance and the Public Service Minister, Audley Shaw, has indicated that the 2.3 per cent out-turn for the September 2016 quarter was the strongest level of economic growth recorded since 2007.
Speaking at a recent Jamaica Micro Financing Association (JaMFA) conference, he attributed this, in part, to an overall 29 per cent growth in the agricultural sector, for which domestic production increased by 43 per cent, as also tourism.
