Banks set to review their lending charges after CBK rate hike

 

NCBA Bank along Standard Street in Nairobi. [Wilberforce Okwiri, Standard]

 

The move by the Central Bank of Kenya (CBK) to raise its lending rate from 7 to 7.5 per cent could force banks to also adjust their charges.

NCBA Bank, for instance, says it is keenly studying the current economic and financial situation before taking the next step.

The bank opened its 83rd branch in Naivasha on Saturday.

Director in charge of retail Tirus Mwithiga said CBK’s rate increase was meant to address inflation, adding that this would affect their lending rates.

“We are studying the consequences of CBK to raise its lending rate and we shall decide on this in the future based on other factors,” he said.

Mr Mwithiga said the bank opened 12 branches last year as part of its expansion plans.

He added that plans were underway to open another 11 this year including Busia, Murang’a, Kenol, Utawala and River Road in Nairobi.

He termed Naivasha one of the business hubs due to the presence of flower farms, hotels, game reserves and the industrial park in Mai Mahiu.

“NCBA is one of the fastest-growing banks in the country and we are keen to expand more so that we can bring our services closer to our customers,” Mr Mwithiga said.

Kenya National Chamber of Commerce and Industry Chairman in Nakuru County, Stephen Thuo, said Naivasha had created a niche as a business hub - including the upcoming World Rally Championship Safari Rally and the proposed industrial park in Mai Mahiu that would employ over 500,000 workers.

Branch manager Frank Matheah said they would be offering various services to customers.

“Currently, our mortgage rates are the lowest at 11.9 per cent and we shall continue to seek more investors who are keen on financial support around the industrial park,” he said.