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The Reserve Bank of Fiji has announced it will roll back an earlier directive that banks and other lending institutions bring down their weighted average lending rates to December 2008 levels.
RBF governor Sada Reddy said all commercial banks had complied with the RBF’s lending rate policy and were on target to meet the 4 percent interest rate margin policy by December 2009.
However, Reddy advised commercial banks to “maintain the trend in lending rate and any increase in spread above 4 percent in the future will have to be fully justified and explained to the RBF”.
The policy came into effect in April this year following the 20 percent devaluation of the Fiji dollar and will be removed effective January 1, 2009, when the RBF will also re-delegate exchange control mechanisms with increase limits to commercial banks and foreign exchange dealers.
