Co-operative Bank of Kenya has assured its customers that it will not increase the interest rates on the existing loans.
In a statement dated November 8, the Group Managing Director and CEO Gideon Muriuki stated that the institution would retain existing interest rates in pursuant to the signing of the Finance Bill 2019.
"We are pleased to advise all our customers that Co-op Bank is meanwhile retaining existing interest rates for all our outstanding loans based on existing money market conditions," he stated.
On November 7, President Uhuru Kenyatta signed into law which repealed Section 33B of the Banking Act that provided for the capping of Interest rates.
The Act meant that commercial banks and other financial institutions now have the liberty to vary their interest rates on loans.
The president noted that the cap on interest rates had led to a decline in economic growth adding that it had led to an increase in shylocks as banks were giving out fewer loans.
"We note that the move by the government will help to avail necessary credit for the growth of the economy and particularly to the Micro and Small and Medium Enterprises segments that are critical for the growth of our dear economy and job creation," Muriuki further noted.
He concluded, "We will keep you updated on any new developments as we constantly endeavour to give you better services."
