Kenya’s biggest lender cuts loan rates after central bank easing

Equity Bank Limited, Kenya’s biggest lender by assets, has reduced pricing on Kenya shilling–denominated variable-rate loans following the Central Bank of Kenya’s decision to lower the Central Bank Rate (CBR) from nine percent to a three-year low of 8.75 percent on Tuesday.

In a statement on Wednesday, the bank said all new variable-rate facilities would now be priced at the prevailing CBR—currently 8.75 percent—plus a customer-specific premium.

“Following the revision of the CBR by the central bank from nine percent to 8.75 percent on February 10, 2026, we wish to notify you of the following changes,” the statement said.

Existing Kenya shilling variable-rate loans already structured at CBR plus Premium (K) will remain under the same framework, but the benchmark component will decline after a 30-day notice period.

“The CBR component will adjust from 9.0 percent to 8.75 percent after 30 days of this notice,” the bank added, noting that the change will reduce total interest payable over time without altering monthly instalments or repayment tenors.

Loans disbursed before December 1, 2025 and currently priced at the Equity Bank Reference Rate (EBRR) plus margin will temporarily retain that structure. However, the bank confirmed these facilities will migrate to the CBR-linked pricing model on February 28, 2026, as previously communicated.

The adjustment reflects broader transmission of monetary easing into Kenya’s lending market, with banks aligning loan pricing to the lower benchmark rate to support credit growth and economic activity.

While repayment schedules will remain unchanged, Equity Bank advised borrowers to review updated loan statements, warning that benchmark revisions could affect cumulative interest costs across the life of facilities.