NCBA Bank Lowers Interest Rates After CBK Review

NCBA Bank has revised Bank Reference Rates for its customers as part of its latest review.

In a statement issued on Friday, October 18, the bank revealed that it would lower the rate from 17.50 per cent to 16.91 per cent per year, effective immediately.

The bank noted that this change follows the Central Bank of Kenya’s decision to reduce the Central Bank Rate from 12.75 per cent to 12.0 per cent on October 8, 2024.

“In view of the recent Kenya Central Bank Rate (CBR) downward revision following a decline in inflation and global monetary policy easing, we wish to inform you that NCBA Bank Kenya’s Base Lending Rates will change as follows,” read the statement in part.

“Kenya Shillings Base Lending Rate will be revised downwards from 17.50% p.a. to 16.91% p.a.”

NCBA Lowers Interest Rates

NCBA also stated that the US Base Lending Rate will be revised downwards from 11.75 percent p.a. to 11.0 percent p.a.

The bank noted that the recent changes in interest rates will affect loan facilities in several ways.

For fixed-rate loans, the adjustment will not have any impact, as these facilities remain unchanged.

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However, the interest rate on variable-rate loans will be adjusted in accordance with the new Base Lending Rates, effective November 18, 2024. For new loan facilities, the new Base Lending Rates will take effect immediately. 

All other terms and conditions of customer loan facilities remain unchanged.

NCBA has advised customers with questions about the base rate changes to contact their respective Relationship Manager or visit any NCBA branch for assistance.

Customers can also reach the Customer Contact Centre at 020-288 4444, 0711 056 444, or 0732 156 444 or email [email protected], message via WhatsApp at 0717 804 444.

Why CBK Lowered Lending Rates

CBK Governor Kamau Thugge announced on October 8 that the Monetary Policy Committee (MPC) lowered the Central Bank Rate (CBR) by 75 basis points to 12.00 percent.

According to Thugge, the decision was made following a review by the committee on October 8, 2024, as part of its regular assessment of the Kenyan and global economic landscape.

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Further, the committee noted a decrease in growth and credit to the private sector, affecting the overall economic activity in the country.

“The MPC also noted the sharp deceleration in credit to the private sector, and the slowdown in growth in the second quarter of 2024, and concluded that there was scope for a further easing of the monetary policy stance to support economic activity while ensuring exchange rate stability.”

“Therefore, the Committee decided to lower the Central Bank Rate (CBR) to 12.00 percent,” the CBK statement read in part.

He stated that the overall inflation has declined further and is expected to remain below the midpoint of the target range in the near term, supported by stable food inflation attributed to improved supply from the ongoing harvests, a stable exchange rate, and lower fuel inflation.

Additionally, the Committee noted that non-food non-fuel (NFNF) inflation has eased and is expected to remain stable, while central banks in the major economies have continued to lower interest rates in response to easing inflationary pressures, with expectations of further reductions in the coming months.

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