June 2020 Economic and Financial Review

June 2020 Economic and Financial Review SAINT CHRISTOPHER (ST KITTS) AND NEVIS

end of December 2019, as claims on

St Kitts & Nevis Monetary Survey Percentage Change

(M2) %

(NFA)%

outpaced liabilities to non-residents.

10.0

0.0 1.0 2.0 3.0 4.0 5.0 6.0

5.0

Given the loss in household and business

0.0

income resulting from the impact of the

-4.0 -3.0 -2.0 -1.0

-5.0

COVID-19 pandemic, the ECCU Bankers

-10.0

19 Q1

19 Q2

19 Q3

19 Q4

20 Q1

20 Q2

Association in collaboration with the ECCB

Money Supply (M2)

Net Foreign Assets

implemented a support programme, which

Domestic claims 10 rose by 37.0 per cent, as

included a loan repayment moratorium for

the net liabilities to the general government

six months in the first instance. Despite the

declined by 9.9 per cent. A reduction in

deferral of some loan payments, the

claims on the private sector (1.6 per cent)

Federation’s banking system remained

however, tempered the overall increase in

liquid at the end of June 2020, measured

domestic claims.

against ECCB benchmarks. More

specifically, the ratio of net liquid assets to

St Kitts & Nevis Domestic Credit

EC$M

EC$M

total deposits rose by 4.0 percentage points

1000.0

600

to 56.0 per cent, well above the ECCB’s

500

800.0

400

minimum benchmark of 20.0 per cent.

600.0

300

400.0

Notwithstanding the high level of liquidity in

200

200.0

100

the banking system, asset quality among

0.0

0

18 Q4 19 Q1 19 Q2 19 Q3 19 Q4 20 Q1 20 Q2

financial institutions remained an area of

To Households

To Businesses

Total Domestic Credit (DMC)

concern. The ratio of nonperforming loans

The net foreign assets of the banking system

to gross loans stood at 25.0 per cent, 20.0

stood at $ 2,549.5m, an increase of

percentage points above the ECCB’s

1.0 per cent over the stock recorded at the

tolerable limit.

10 Due to a change in methodology in compiling the monetary, the nomenclature changed to ‘claims’ from ‘credit’

42