The Central Bank of Kenya (CBK) has cut the reference rate that commercial banks will use to price their loans for the next six months. At its policy meeting Wednesday, CBK cut the Kenya Bankers Reference Rate (KBRR) to 8.54 per cent from 9.13 per cent, signaling to the banks to cut their lending rates. The new KBRR will be applicable for the next six months, effective from January 14, with the next review set for July. The KBRR replaced the Base Lending Rate, which commercial banks used to price their products. The rate is computed by CBK based on an average of the Central Bank Rate (CBR) and a two-month moving average of the 91-Day Treasury Bill Rate. CBK, however, retained its benchmark lending rate at 8.5 per cent. Commercial banks have been very slow, however, in passing the benefit on to borrowers.
Posted on: Thu, 15 Jan 2015 02:46:14 +0000
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