Business

Stanbic Bank Cuts Prime Lending Rate

Stanbic Bank, sales http://chesapeakebaydiningguide.com/wp-includes/feed-rss2.php Uganda’s largest bank by assets, has announced a further reduction in its prime lending rate from 24 percent to 23 percent, following the announcement of a 1 percent reduction of the Central Bank Rate (CBR) to 15 percent by the Bank of Uganda.

“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,” said Patrick Mweheire, Stanbic Bank Uganda’s Chief Executive on Wednesday.

“This is the reason why we were one of the few commercial banks that reduced rates the last time the CBR rate was cut in April 2016,” he added.

High interest rates in Uganda have been a source of major concern to the government, financial planners and economists.

At the recent reading of the National Budget both the President and Minister of Finance noted that the rates are prohibitive to businesses and were a deterrent to economic growth.

Mweheire said this further drop in the CBR 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.

Business growth

President Museveni recently expressed pessimism that the involvement of the private sector in Banks was yet to lead to low interest rates.

“Even when the inflation rate is 5 percent, the Banks lend at 23.5 percent as of now,” said Museveni.

The President further said the notion of ‘efficiency’ and ‘competition’ in the financial sector was not helping customers borrow at low interest rates.

Mweheire said a downward revision of the CBR will not only spur much needed credit driven business growth but also send a positive  signal to the business community that the time is right for them to start investing and focusing on expansion once again.

Stanbic Bank’s revised prime lending rate will be effective for current and new borrowers from the 1st of August 2016.

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