The ECCB's members are Anguilla, Antigua and Barbuda, Dominica, Grenada, Montserrat, St Kitts and Nevis, Saint Lucia, and St Vincent and the Grenadines.

The Council said in a communique that external reserves at 96.4% of demand liabilities continued to provide adequate backing for the areas currency, the Eastern Caribbean dollar, which is pegged to the US dollar. It summarized the monetary situation as follows:

• The capital adequacy ratio for the locally incorporated banks, used to determine the robustness of financial institutions to shocks to their balance sheets, was satisfactory and exceeded the internationally accepted benchmark of 8.0 per cent.
• The liquidity of the banking system remained strong. The net liquid assets ratio was 41.1 per cent compared with 38.5 per cent at the end of 2004.
• The money supply, domestic credit and the net foreign assets of the banking system grew moderately.
• Interest rates in the ECCU remained relatively stable during the period under review. Interest rates in savings deposits ranged from 3.0 per cent to 5.0 per cent and prime lending rates from 8.5 per cent to 12.0 per cent.

The Council noted that activity in the securities market continued to increase. As at 17 October 2005, the outstanding value of Treasury bills on the Regional Government Securities Market (RGSM) was $97.45 million and the outstanding value of bonds was $312 million. The value of shares traded on the Eastern Caribbean Securities Exchange (ECSE) up to 15 September 2005 was $1.77 million.

The Council welcomed the favourable outlook for growth of 5.8% in the ECCU for 2005 and noted that this was driven by the expansion in construction and in tourism related activities. The projection for growth of 7.0% in 2006 would be fuelled largely by further growth in the tourism sector and construction activity in preparation for the Cricket World Cup in 2007.

The Council decided to maintain the officially administered interest rates at 3% for the regulated minimum rate of interest on savings deposit and 6.5% for the Central Bank’s discount rate.

The Council expressed strong support to the ECCB’s efforts in establishing money and capital market institutions, namely the Eastern Caribbean Home Mortgage Bank (ECHMB), the Eastern Caribbean Securities Exchange (ECSE), the Regional Government Securities Market (RGSM) and the Eastern Caribbean Institute of Banking and Financial Services (ECIB), and expressed satisfaction on the progress made by these institutions to date.

The Council further agreed to continue the lobbying of regional ministerial bodies for recognition of the ECSE as the appropriate solution for the single regional exchange within the Caricom Single Market and Economy (CSME).