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Interest Rate Spreads in English-Speaking African Countries
Author:
Mr. Joe Crowley
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Series:
IMF Working Papers
Volume/Issue:
Volume 2007: Issue 101
Language:
English
Publication Date:
01 Apr 2007
DOI:
https://doi.org/10.5089/9781451866650.001
ISBN:
9781451866650
ISSN:
1018-5941
Pages:
34
Keywords:
WP; interest income; lending rate; adjusted interest rate; interest rate spread; deposit rate
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper examines interest rate spreads in English-speaking African countries. Higher spreads were found to be associated with lower inflation, a greater number of banks, and greater public ownership of banks. Higher deposit interest rates were found to be associated with lower interest rate spreads, but higher net interest margins. A large increase in spreads in the late 1980s and 1990s may be explained by a strengthening of financial sector supervision. Limited data suggested that poor governance, weak regulatory frameworks and property rights, and higher required reserve ratios are associated with higher spreads.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund