The NCBA Bank Kenya has raised its lending rates on new and existing loans. The bank announced that the new base lending rates will come into effect immediately for new loan facilities.
The rates hike was communicated to customers via messages. In one of the messages seen by Bizna Kenya, NCBA attributed the hike on what it termed as the ongoing changes in the macroeconomic environment.
“We wish to inform you that NCBA Bank Kenya’s Base Lending Rates will change. Kenya Shillings Base Lending Rate will increase from 16.50 per cent per annum to 17.50 per annum,” the NCBA Bank announced.
The lender added that the United States Dollars Base Lending Rate will increase from 11.0 per cent per annum to 11.75 per cent рer annum.
Shilling loses gains against USD; falls to 132 as banks, forex bureaus near 140
These changes will not have any effect on fixed rate loan facilities. However, on variable rate loans, the interest rate on loan facilities priced off the NCBA Bank’ s Base lending rate will increase by 1 per cent per annum for Kenya Shilling loans and by 0.75 per cent per annum for the USD loans effective May 21, 2024.
NCBA Bank Kenya is not the only mainstream bank that has raised interest rates on loans. Two months ago, some commercial banks in Kenya hiked their interest rates on loans to as high as over 26 per cent.
These hikes in interest rates on loans followed the increase of the benchmark lending rate by the Central Bank of Kenya in December 2023 and February 2024.
Among lenders who hiked their interest rates is Equity Bank, which announced that it would henceforth charge 26.74 per cent on new loans taken by risky borrowers. The bank also adjusted its reference rate from 17.56 per cent to 18.24 per cent.
“Following the adjustment of the Central Bank Rate (CBR) from 10.5 to 12.5 per cent in December 2023 and from 12.5 per cent to 13 percent in February 2024, Equity Bank wishes to notify our customers and the general public, that the bank shall, effective February 20, 2024, adjust Equity Bank’s Reference rate (EBRR) from the current 17.56 to 18.24 percent,” Equity Bank had announced in a notice message sent to its customers.