Banks prepared to take loss

Published: Monday August 11, 2008

COMMERCIAL BANKS say they may lose revenue as a result of stricter Central Bank of Barbados guidelines imposed on them for setting service fees for customers.

However, that is not a problem, according to Stephen Cozier, immediate past president of the Barbados Bankers' Association.

"I don't feel that there is going to be a significant impact on the banks to the point that we have to be concerned. We are tightening the belt just like everybody else is being asked to, and this is one area in which we are doing it.

"There is room for us to make a contribution and we'll accept it, absorb the revenue reduction and continue to serve the public," he told BARBADOS BUSINESS AUTHORITY on Friday.

Last Thursday the Central Bank announced a new fee structure for four areas of commercial banking services that take effect today, stating: "The percentage charged for application/negotiation fees should not exceed 0.5 per cent of the loan amount; the percentage used to calculate commitment/standby fees should not exceed 1.0 per cent of the loan amount; charges for transfers via the Real Time Gross Settlement should not exceed $15 and charges for transfers between banks effected through manager's cheques should not exceed $15."

In addition, the Central Bank said in its release all commercial banks had agreed "to offer customers at least one savings account product that pays interest on a daily basis".

Cozier said some banks may lose revenue "to the extent that some may have to reduce their fees to fall within the range that we agreed to".

And it was difficult to predict the true impact, which depended on the extent to which revenue was generated from the particular services.


Source: Nation Newspapers
http://www.nationnews.com/story/296794351949282.php