Stanbic slices lending rate by 1pc

June 29, 2016 in Business, Companies, Finance, Financial Services, Markets, Policy by Editor

KAMPALA, JUNE 29 – Stanbic Bank, Uganda’s largest lender, has announced a one percentange reduction in its prime lending rate to 23 percent, tracking a similar movement in the Central Bank Rate (CBR) to 15 percent by the Bank of Uganda.

The revised rate goes into effect August 1; one month after the CBR kicks in.

“As a bank we track our local currency prime rate against the movements of the CBR, to maintain the transparency of our pricing to our clients. This is the reason we were one of the few commercial banks that reduced rates the last time the CBR rate was cut in April 2016,” said Patrick Mweheire, Stanbic Bank Uganda’s Chief Executive.

“Theis further drop in the CBR is welcome; it will stimulate private sector credit growth and ease the pressure on our borrowing clients. Stanbic Bank is proud once again to be a leader in adjusting its rates downwards and we are confident our clients will greatly benefit from our actions,” he added.

High interest rates in Uganda have been a source of major concern to the government and business community as the economy slid into recession on reduced borrowing by the private sector last financial year. At the recent reading of the National Budget both the President and Minister of Finance noted that lending rates were prohibitive to businesses and were a deterrent to economic growth.

“A downward revision of the CBR is therefore important because not only will it spur much needed credit driven business growth, it also sends a positive signal to the business community that the time is right for them to start investing and focusing on expansion once again,” said Mr. Mweheire.