Finance, Forex and Investments

When income per capita is low in a country, what effect does it have on commercial banks?

does it mean that people have less money to save, so banks have less reserves and then can only lend less? meaning less profit?

Public Comments

1. yes, that is exactly what it means the lower the GDP per capita, the higher the mpc (marginal propensity to consume) is, meaning less money to save. however, because of individual fiscal policies internationally, this can vary
2. The marginal propensity to save is low. Low domestic savings (in commercial banks) adversely affects investment rate.