Bank Supervision & Banking Sector Reports
- Bank Supervision Annual Reports
- Banking Sector Reports
- Commercial Banks Ave Lending Rates
- KBRR Data Reports
- Fintech Reports
Bank Supervision Annual Reports
Banking Sector Quarterly Reports
Banking Sector Commercial Banks Lending Rates
Banking Sector KBRR Report
|KBRR Data - May 2015|
The lack of comparable information on pricing of loan products in the banking sector can expose borrowers to high interest rates. The Kenya Banks’ Reference Rate (KBRR) was introduced in July 2014 as a uniform benchmark lending rate across the banking sector to enable consumers to compare the pricing of loan products. Publication of information on interest rates for the banking sector is therefore expected to increase transparency and competition, enhance credit access and lower the overall cost of credit to borrowers.
Determination of Level of KBRR
KBRR is computed as an average of the Central Bank Rate (CBR) and the two-month weighted moving average of the 91-day Treasury bill rate. The Central Bank of Kenya, through the Monetary Policy Committee, reviews the KBRR every six months.
The past and current levels of the KBRR are:
• 8th July 2014 – 9.13 percent
• 14th January 2015 – 8.54 percent
KBRR is the interest rate a bank charges on riskless lending. Bank loans will be offered at an interest rate of KBRR + “K”, where “K” is the premium levied by banks above KBRR and should cover the identified loan-associated risks. The premium “K” could be negative, if, for instance, the lender perceives advantages to being associated with a particular borrower. Banks are required to disclose to their customers the composition of “K”.
Publication of the average premium (“K’)
The Bank will continue to provide information on the premium “K” to the general public as and when it becomes available. The Central Bank of Kenya will publish the bank specific data on the weighted average “K” for each type of loan product.