Mauritian Central Bank Urges Lenders to Boost Deposit Rates

PORT LOUIS (Capital Markets in Africa) – Mauritius’s central bank urged commercial lenders benefiting from the lowest official interest rates in more than a decade to increase the amount they pay depositors.

Bank of Mauritius Governor Yandraduth Googoolye said he plans to put the revision of savings rates on the agenda at a forthcoming meeting with lenders.

“Bearing in mind that in 2015 banks had lowered interests rates without any change in the key repo rate, I know that banks can also adjust their rates in favour of their customers,” Googoolye said in a speech emailed Wednesday from the capital, Port Louis. “The revision of savings rate is justly on my agenda for the forthcoming banking committee and I am sure that banks will respond favourably to my call.”

The central bank’s Monetary Policy Committee in May unanimously agreed to keep the official repo rate at 3.5 percent, the lowest since it was introduced in 2007, to help stimulate economic growth in the Indian Ocean island nation. The MPC is likely to hold the rate unchanged this year and reduce it further in 2019, BMI Research said in an emailed note on Monday.

The weighted average deposit rate at Mauritian lenders was 1.65 percent a year in May, compared with a weighted average rupee-lending rate of 6.19 percent, according to data published on the central bank’s website last month.

Mauritius’s biggest lenders include MCB Group Ltd. and SBM Holdings Ltd.

Source: Bloomberg Business News