The Jamaica Banker’s Association, JBA, says the financial sector is performing well despite the ongoing COVID 19 pandemic.
President of the Jamaica Banker’s Association, JBA, Jerome Smalling was reacting to Economist Professor Densil Williams’ call for government intervention in the sector.
Professor Williams raised concerns about a potential crisis in the banking sector, noting that financial institutions have had to be extending moratorium on loans for companies hit by the pandemic.
Mr Smalling says banks have increased in assets, profit and loans since 2019.
He says at the onset of the COVID 19 pandemic, the Central Bank injected some 60-billion dollars into the sector and restricted dividend payments from companies, to only shareholders who owned less than one percent shares.
He agrees that several companies hit hard by the pandemic have had to request extended moratorium on their loans.
Smalling noted that the two benchmarks of performance in the sector are liquidity and capital adequacy.
Capital adequacy, refers to the ratio of a bank’s capital in relation to its liabilities.
He says the banking sector is now able to perform well despite the pandemic because it had undergone what Mr Smalling calls stress testing in the past.