BANKING MARKET INTEGRATION IN THE SADC COUNTRIES: EVIDENCE FROM INTEREST RATE ANALYSES

International audience This study investigates the state, development and drivers of banking market integration in the member countries of the Southern African Development Community. A principal component analysis of national retail interest rates indicates increasing integration in loan and deposit markets. These integration processes are not developing uniformly and we can identify a convergence club. When investigating the interest rate pass-through from central bank onto retail rates for this convergence club, we find both, genuine and monetary-integration driven processes though the latter dominate. We thus conclude that a selective expansion of the Common Monetary Area is possible.