National Bank Reduces Interest Rates for New and Existing Loans

The National Bank of Kenya (NBK) has announced a reduction in lending rates for new and existing loans.

In a notice on Monday, April 14, the National Bank said it has lowered the rates from 14.96 percent to 14.50 percent per annum (p.a.).

“We would like to inform you that the Bank has further adjusted its Base Rate for loans denominated in Kenya Shillings (Ksh) from 14.96% to 14.50% p.a. for facilities priced based on NBK Base Rate,’ reads part of the notice.

The revised rate is effective from April 14, 2025, for new facilities and May 14, 2025, for existing facilities.

NBK explained that the reduction is subject to the applicable customer risk profile.

National Bank Contacts for Clarification

Customers can contact callcentre@nationalbank.co.ke ,+254 (20) 282 8900, +254 703 088 900 or +254732 118 900 for more information.

Alternatively, they can visit any NBK branch countrywide for information and assistance.

CBK Reduces CBR

This follows the Central Bank of Kenya’s (CBK) move to lower the Central Bank Rate (CBR) after a Monetary Policy Committee (MPC) meeting on April 8, 2025.

CBR is the interest rate that CBK uses to lend money to commercial banks.

In a statement after the meeting, CBK Governor Dr. Kamau Thugge said MPC lowered the CBR by 75 basis points to 10.00 percent from 10.75 percent, the lowest the benchmark has been since May 2023.

“The Committee concluded that there was scope for a further casing of the monetary policy stance to stimulate lending by banks to the private sector and support economic activity while ensuring exchange rate stability,” reads part of the statement.

MPC said the average lending rates have been declining gradually since December 2024, but private sector credit growth remains subdued.

Also Read: CBK Governor Reveals Details of Multibillion Loans from IMF and UAE 

Banking Sector Remains Stable

Additionally, the Committee said the banking sector remains stable and resilient, with strong liquidity and capital adequacy ratios.

The ratio of gross non-performing loans (NPLs) to gross loans stood at 17.2 percent in February 2025 compared to 16.4 percent in December 2024.

Besides, increases in NPLs were noted in real estate, personal and household, trade, building and construction, and manufacturing sectors. Banks have continued to make adequate provisions for the NPLs.

Also Read: KCB Reduces Interest Rates on New and Existing Loans

Commercial bank lending to the private sector recorded a modest growth of 0.2 percent in March 2025 from a contraction of 1.3 percent in February.

This reflects a dissipation of exchange rate valuation effects on foreign currency-denominated loans following the appreciation of the Shilling and improved demand with declining lending interest rates.

Average commercial banks’ lending rates declined to 15.8 percent in March 2025, from 16.4 percent in February and 17.2 percent in November 2024.

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