Banks trim savings rates post-MPR easing

Nigerian deposit money banks have begun lowering the interest rates paid on savings accounts following a cautious easing of the Monetary Policy Rate (MPR) by the Central Bank of Nigeria (CBN), a move that is gradually filtering through the financial system and reshaping returns for depositors.

The adjustment comes after the Central Bank reduced its benchmark rate, prompting lenders to recalibrate pricing across retail products, particularly savings accounts, where returns are typically tied to a proportion of the policy rate.

Ayodele Akinwunmi, chief economist at United Capital Plc, said the benchmark savings deposit rate is currently 7.95 percent per annum, representing 30 percent of the prevailing Monetary Policy Rate of 26.5 percent.

In savings account interest rate notices sent to customers, banks reiterated the conditions attached to the rate. “Please note: the 7.95 percent interest rate is only applicable if a customer makes no more than four withdrawals in a month. If more than four withdrawals are made within the same month, the interest rate will not apply,” according to notices seen by BusinessDay.

Data published by the Central Bank as of February 27, 2026, showed that 14 lenders have aligned their savings rates with the 7.95 percent benchmark. These include Access Bank, Citibank, Fidelity Bank, Guaranty Trust Bank, Keystone Bank, Optimus Bank, Parallex Bank, Polaris Bank, PremiumTrust Bank, Signature Bank, Sterling Bank, Tatum Bank, Unity Bank and Wema Bank.

A second tier of lenders is offering slightly higher rates, with 10 banks quoting returns above the benchmark. Alpha Bank is offering 8.10 percent, First Bank 8.25 percent, Globus Bank 8.18 percent, Nova Bank 8.00 percent, Providus Bank 8.10 percent, Standard Chartered Bank 8.10 percent, SunTrust Bank 8.10 percent, United Bank for Africa 8.10 percent and Zenith Bank 8.10 percent.

However, three banks are offering rates below the regulatory threshold, highlighting divergence in pricing strategies across the industry. Ecobank is offering 5.90 percent, First City Monument Bank 4.25 percent, while Stanbic IBTC Bank is quoting 2.70 percent on savings deposits.

The Central Bank has also moved to improve transparency in the banking system, directing that lending rates across deposit money banks be made public to guide business and consumer decisions.

At its February 2026 meeting, the Monetary Policy Committee reduced the Monetary Policy Rate by 50 basis points to 26.50 percent, while retaining other key parameters. The asymmetric corridor around the MPR was left unchanged at plus 50 basis points and minus 450 basis points. The cash reserve ratio (CRR) for deposit money banks was maintained at 45.00 percent, while that of merchant banks remained at 16.00 percent. The CRR on non-Treasury Single Account public sector deposits was retained at 75 percent, and the liquidity ratio held steady at 30.00 percent.

The Committee said its decision reflected a balanced assessment of risks to the macroeconomic outlook, expressing confidence that the disinflation trend remains on track. Members cited the lagged impact of earlier monetary tightening, relative exchange rate stability and improved domestic food supply conditions as key supporting factors.

For households, the reduction in the policy rate signals the prospect of improved purchasing power as inflationary pressures gradually ease, particularly through moderation in food prices and relative stability in service costs. However, the benefits of lower rates may take time to fully materialise.

An investment banker based in Lagos noted that while declining interest rates could eventually reduce borrowing costs, structural constraints such as elevated cash reserve requirements and high deposit costs may slow the transmission to cheaper credit for households and small businesses.

Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise, said the rate cut sends a positive signal to investors and the broader business community. According to him, even a modest policy easing provides both psychological and financial relief after a prolonged period of intense cost pressures driven by energy prices, logistics challenges, exchange rate volatility and high borrowing costs.

He added that the real impact of the policy shift will ultimately depend on how effectively the changes are transmitted through the banking system to businesses and consumers.