Jamaica not exposed to issues affecting failed US banks - Clarke

 

Finance Minister Dr. Nigel Clarke says, as far as he is aware, Jamaica is not systemically exposed to the issues affecting Silicon Valley Bank and Signature Bank in the US.

 

Speaking with Beyond the Headlines host Dionne Jackson Miller, Dr. Clarke said the country has adequate safeguards in place to tackle a number of unlikely events. 

 

"When authorities begin to raise interest rates in the way they have over the past year, you can get mismatches that lead to problems, some of what we have seen happening in the United States. The good news is that, certainly as far as our foreign exporters are concerned, Jamaica has lined up $1.7 billion worth of lines of credit which we don't have to all draw down. We have these credit lines in place because of my view that we are in uncertain times," Dr.  Clarke explained.  

 

The Finance Minister said he does not expect any spillover from the US bank failures into the local economy.

 

"Financial sector stability is one of the pillars of macroeconomics and something we keep a watchful eye on. At this point in time, I don't see any reason to worry about developments at those financial institutions in the United States, as I don't see any sort of impact from those developments and Jamaica." 

 

Silicon Valley Bank and Signature Bank failed last week, as hundreds of investors sought to withdraw funds, but their requests could not be met.

 

The US government later intervened, assuring depositors of their funds, taking over management of the banks and pledging to fire the banks' leadership.

 

US President Joe Biden also announced a review of the banking sector and possibly more stringent rules for banks.