THE Bank of Jamaica (BOJ) yesterday launched its latest denomination – a $5,000 note featuring the image of former prime minister Hugh Shearer which it says will become legal tender in September.

According to BOJ Governor Derick Latibeaudiere, the new bill became necessary in response to international benchmarks as well as the need to equate the value of our highest note against the US dollar.

“With the introduction of the $5,000 banknote, the US dollar equivalent of our highest note will now be $56.30 using today’s exchange rate,” Latibeaudiere said at the launch at the BOJ, downtown Kingston.

Latibeaudiere, in defending the need for a new note, argued that an internationally accepted principle was that the highest denomination in a country should account for no more than 60 per cent of the total value of the notes in circulation.

“Jamaica has exceeded this limit for some time and had therefore taken the decision to introduce the new note,” Latibeaudiere said.

“At March 31, Jamaica’s highest banknote accounted for 76.65 per cent of the total value of the notes in circulation, or 16.65 percentage points above the recommended international standard,” the BOJ governor said.

He added that Jamaica’s $1,000 value was below a second benchmark, which suggests that the highest denomination in a country should be five times the average day’s pay.

“Available data indicate that Jamaica’s highest denomination should be in the region $8,000,” Latibeaudiere said.

In addition to these benchmarks, Latibeaudiere explained that the equivalence of the highest denomination to a major trading currency such as the US dollar was also used in assessing the need for a higher value denomination.

Jamaica’s highest denomination, the $1,000, is equivalent to $11.26, he remarked, adding that this figure was very low when compared to Jamaica’s trading partners.