Kenya’s largest lender with $10.8 billion in assets, KCB Bank Group, has complied to CBK directive to all banks to lower their lending rates. KCB, has taken a step further to cut its lending rate from 15.6%
to 14.6% on February 10, 2025.
This decision, follows the Central Bank of Kenya’s (CBK) recent benchmark
rate decrease to 10.75% and aggressive strategy to cut commercial bank rates.
READ ALSO: Banks Committed To Reduced Lending Rates To Spur Economic Growth
Compliance was enforced by CBK physical bank inspections on February 5, threatening daily fines and penalties for non-compliant institutions. The central
bank decreased the cash reserve ratio to 3.25%, releasing $570 million into Kenya’s economy despite
banks’ concerns about high fixed deposit costs.
This rate cut addresses Kenya’s 22-year low private sector credit growth and supports economic recovery. The action should increase lending access, lower non-performing loans in important sectors, and prompt other commercial banks to decrease rates.