Chaguanas Chamber calls on banks to be more sensitive

In a media statement yesterday, the Chamber expressed concern with the “current state of the economy of Trinidad and Tobago and the ongoing demise of a number of business organisations over the past year.” “As the national economy has continued to contract, businesses have been forced to adopt various strategies in order to cut costs, manage cash flow, and realign their operations in order to stay afloat.

Under these present economic conditions revenue streams have become thinner and profits are declining,” the Chamber stated, though pointing out that the banking sector seemed to “continue to grow large profits.” “The Chaguanas Chamber is concerned that the existing gap between the deposit rate and lending rate is far too wide.

As a result, research showed that the interest rate spreads among the commercial banks and perhaps other similar financial institutions are among the largest in countries that have open economies.

We urge the banks to reflect and do something about this urgently.” The Chamber also urged banks to revise their service charges which it said can be deemed “ridiculous and exploitative” and cited persons being charged fees for encashing cheques in banks where they did not have any accounts.

“The fact that there have been no decreases in prime lending and overdraft rates could reflect a lack of interest by the banks in adapting like other business organisations, and share in the burden of adjustment within this very challenging economic environment,” the Chamber added.

The Chamber also noted that commercial banks tend to increase their lending rates whenever the Central Bank raised the repo rate adding there was “some potential for this repo rate to increase further in the coming year due to anticipated actions of the United States Federal Reserve.” “The commercial banks must realise that this economic recession is deepening and intensifying. People are losing their jobs and businesses are under immense stress.

Citizens are under pressure to pay their loans, mortgages and credit cards.

Therefore, we call on the banks to be much more sensitive and work with their clients for mutual interest and for the best development of our country and our people,” the Chamber added.