The main objective of Saint Lucia's public debt management is to meet Government financing requirements
at a minimum cost with a prudent degree of risk. In keeping with this objective, the Ministry of Finance,
Economic Growth, Job Creation, External Affairs and Public Service is committed to pursuing a debt
management strategy aimed at fulfilling this objective. The Debt and Investment Unit (DIU) is the Government
of Saint Lucia's (GoSL) primary agent responsible for managing its public debt portfolio.
This paper empirically examines the determinants of commercial bank deposits in Saint Lucia using data
over the period 1995-2018 to identify the factors which have been contributing to Saint Lucia’s constant
deposit growth. Using the ARDL bounds test approach to assess cointegration, results indicate that in the
short-run, GDP and inflation rates are cointegrated with deposits rates while in the long-run no cointegration
exists between the independent variables and deposits. Employing the Toda-Yamamoto test to assess
causality among deposits and the other variables, results indicate that in the long-run, corporate income
tax, GDP, inflation, remittances and interest rates all positively and significantly influence deposit rates in
Saint Lucia. These findings suggest that in the short-run, Saint Lucian policy makers can influence deposit
rates through growth enhancing policies. However, in the long-run policies aimed at attracting remittances
as a special interest rate on bank deposits for persons who live abroad or policies aimed at encouraging
investments with remitted funds may be particularly important for the Saint Lucian economy. This study
has implications for development and formulation of monetary policy for Saint Lucia and similar small open
economies.