Bank loan rates in August ran from 10.5% to 18.7%

The average interest rate charged by Kenya’s commercial banks eased to 14.34% in August, from 14.39% in July, according to the Central Bank of Kenya. Behind that average is a wide spread. The Central Bank’s figures for individual banks, released on 30 September, run from 10.52% to 18.69%.

Average lending rates in August, lowest to highest

• Citibank: 10.52%
• Standard Chartered: about 11.5%
• Stanbic: 11.93%
• Habib Bank A.G. Zurich: 12.68%
• HFC: 13.07%
• KCB: 14.78%
• Equity: 14.90%
• Co-operative Bank: 15.01%
• SBM: 17.17%
• Kingdom Bank: 17.21%
• Access Bank: 17.32%
• Bank of Africa: 17.45%
• Credit Bank: 18.69%

Business Daily reports that 14 of the 38 banks, mostly smaller ones, raised their average rates in August. Small banks are paying 8% to 11% to attract deposits, it says, against 5.72% at Co-operative Bank, 6.35% at KCB and 6.83% at Equity, and that cost is passed on to borrowers.

These are averages across all of a bank’s loans. What one business is offered depends on the loan, the security behind it and its record with the bank. The Central Bank kept its own benchmark rate at 8.75% on 7 October, and says the average lending rate edged up to 14.4% in September.