CBA pegs its loans as per Kenya Bankers rate of 12.9% and becomes the lowest bank lender

Business | Friday 9 Sep 2016 10:43 pm

12.9%, that is the new applicable interest rate on loans at the commercial bank of Africa, CBA, which is now the lowest by far in the market. The bank has decided to peg interest rates applicable to the Kenya banker’s reference rate or KBRR rather than the central bank rate or CBR as other lenders have done. In a statement to customers, CBA says quote, “CBA will lend at a maximum interest rate of 12.9% and pay a minimum interest rate of 6.23% on local currency loans and deposits respectively. The new rates will apply to new and existing facilities’, end quote.  The bank says the decision to affect the new rates at 12.9% rather than 14.5% as other banks have done, is informed by the commitment to fully comply with both the letter and spirit of the law. There has been a lot of confusion over the applicable rate of interest as spelt out by the law, with a court case brought by activist Okiya Omtatah already in court to force banks to drop the 1.6 percent between