Equity Bank has announced a reduction in interest rates on both new and existing Kenya Shilling-denominated credit facilities, in line with an earlier pledge offering relief for borrowers.

The move comes even as other leading lenders remain slow to respond to calls by the Kenya Kwanza administration to cut their interest rates frustrating regulators and Ruto government officials amid an economic slowdown linked to the ongoing credit crunch.

This move follows the Central Bank of Kenya's (CBK) decision to lower the Central Bank Rate (CBR) from 12.75 per cent to 12.0 per cent to stimulate credit to the economy. 

Yesterday, Equity Bank said effective November 18, 2024, it has cut loan charges to make credit more affordable and accessible. This marks the second time in three months that Equity Bank has adjusted its lending rates, with a previous reduction occurring in September this year.

The new interest structure will see the Equity Bank Reference Rate (EBRR) decrease from 17.83 per cent to 17.39 per cent which is then combined with a maximum margin of 8.5 per cent per annum.

“With this reduction, all new and existing customers with Kenya Shilling-denominated loans will benefit from lower borrowing costs, providing immediate relief and supporting their financial aspirations,” said Equity Group Chief Executive Officer James Mwangi in a statement.

Mr Mwangi had earlier promised to effect the cut during the release of the bank's financial results for the third quarter of 2024 at an investor briefing last week. He at the time emphasised that the reduction aligns with the CBK's objective to maintain economic stability amid improving inflation trends and favourable economic indicators. 

Pressure has been mounting on commercial banks to lower interest rates, but many lenders had by press time yesterday maintained higher rates sparking concern from President Ruto and CBK Governor Kamau Thugge. 

The move by Equity Bank, along with pressure from the CBK and government, could lead to a more significant reduction in lending rates by additional banks potentially benefiting Kenyan borrowers and fostering economic activity, analysts said.

The CBK’s MPC recently cut the Central Bank Rate (CBR) from 12.75 per cent to 12.00 per cent aiming to bolster economic activity amid declining inflation.

This followed another reduction of the CBR in August from 13.00 per cent to 12.75 per cent, as the CBK hopes to foster growth amidst a backdrop of declining inflation and a revised growth forecast.

However, banks except a few major banks like Equity Group have been slow to pass these rate cuts onto borrowers, citing concerns over rising funding costs and the quality of their loan portfolios.

The tightening of lending standards by banks is having a negative impact on the economy, as businesses and households are finding it more difficult to access credit.

This is leading to a further slowdown in economic growth and a rise in unemployment dealing a blow for government efforts to boost liquidity and access to capital for individuals and businesses.

Equity joins NCBA Bank, which was the first to respond to the latest CBR cut by reducing interest rates on loans.

Equity Bank in September had reduced its Reference Rate from 18.24 per cent to 17.83 per cent, a move aimed at stimulating credit uptake amid a challenging economic landscape.

Amid the CBR reduction, lending to the private sector has sharply declined, with growth falling from 3.7per cent in July to just 1.3 per cent in August.

This contraction is largely attributed to an increase in NPLs, which rose to 16.7 per cent of gross loans in August, up from 16.3 per cent the previous month.

Historically, Kenyan banks have been quick to raise rates whenever the CBK increases the benchmark rate, often citing rising costs of funds as justification.

This pattern has raised expectations that they would be equally responsive in lowering rates following the recent cut but banks have been reluctant.

“I would like to strongly urge the banks to lower their lending rates as soon as possible. This will be a win win for both consumers, investors as well as the banks as it would stimulate economic growth by boosting credit to the private sector while at the same time addressing the rising non-performing loans of banks,” said Thuge recently.

“With inflation declining steadily and expected to decline and the CBK easing monetary policy there is absolutely no reason not to have lower interest rates by the commercial banks.” 

 Thugge revealed in a meeting attended by several bank CEOs as well as President Ruto he has gathered bank CEOs to address the loan rates.  

Thugge had expressed concern about the tightening of lending standards by banks, arguing it negatively impacts economic growth by hindering access to credit for businesses and households.

He stated, "There's absolutely no reason not to have lower interest rates by the commercial banks" with declining inflation and a more relaxed monetary policy stance by the CBK.

“Your Excellency, we have agreed with commercial banks that we will be having a meeting just to brainstorm on how to ensure that with the lower inflation and the lower CBR they also extend lower interest rates to borrowers.” 

The Kenya Bankers Association (KBA) has countered that banks have already begun lowering rates, although the impact may not be fully reflected in weighted average interest rates yet.

However, a recent CBK survey suggests a cautious approach by banks, prioritizing existing relationships with larger clients while limiting credit access for small and medium enterprises (SMEs).

Newly appointed National Treasury Cabinet Secretary John Mbadi sees lower interest rates as a key driver for increased economic liquidity. This could stimulate growth across various sectors, especially as SMEs gain greater access to credit.

Mwangi urged the CBK - whose Monetary Policy Committee making organ will meet next month on December -5 to lower the benchmark rate again later this year to further stimulate borrowing.

“We hope to see further reductions in the benchmark rate before the end of the year to stimulate credit uptake." By Brian Ngugi, The Standard

A 16-year-old boy has been arrested on suspicion of murder after a Zimbabwean man was fatally stabbed inside his own flat in the early hours of Tuesday morning in Leeds. The victim, identified as 23-year-old Saymore, was found with fatal injuries at his ground-floor home in the Belle Isle area.

The young man, along with an 18-year-old, was detained after a police helicopter assisted in tracking down the suspects, who had reportedly fled the scene. The two suspects were located in the Middleton area of Leeds and arrested on suspicion of murder and possession with intent to supply Class A drugs.

Saymore was rushed to the hospital but was later declared dead from his injuries. West Yorkshire Police have since launched a murder investigation, with detectives from the Homicide and Major Enquiry Team now leading the case. A forensic examination of the crime scene at Winrose Avenue is ongoing, and police have also set up a second scene at an address in Sissons Road, Middleton, after drugs linked to the arrests were discovered.

Detective Chief Inspector James Entwistle, who is heading the investigation, expressed his condolences to the victim's family, describing the attack as a "tragic" and "violent" event. He urged anyone who may have witnessed suspicious activity or a disturbance near the address around the time of the attack to come forward with information. 

"Our investigation remains in its very early stages, and we are still building up a picture of the circumstances in which this young man has been fatally attacked," Entwistle said. "His death, in such a sudden and violent way, is an absolute tragedy. We are continuing to support his family at this very difficult time."

The police are particularly keen to hear from anyone who may have CCTV or doorbell footage that could be relevant, as well as any dashcam footage from drivers in the area at the time of the incident. Officers have also begun house-to-house enquiries in the local area.

"We recognise that people in the community will be shocked by what has happened, and I want to reassure them that we are treating this incident very seriously," said Entwistle. "We are liaising closely with our district policing colleagues, who will maintain an increased presence in the area to provide reassurance."

The police investigation is ongoing, and authorities have urged the public to come forward with any information that could help them piece together the events leading up to the fatal stabbing. Bulawayo 24 News

The Miss Universe pageant, one of the most prestigious international beauty competitions, has long been a platform for celebrating beauty, intelligence, and cultural pride. While the crown has travelled across continents, African countries have made their mark with victories that have inspired generations.

In the just concluded 2024 Miss Universe competition in Mexico Nigeria’s Chidinma Adetshina emerged first runner up and was ultimately crowned Miss Africa and Oceania. This was a huge fit as she was the only African in the top 5.

Here are the five African countries that have triumphed in the Miss Universe pageant: Namibia, Botswana, South Africa, and Angola.

1. Namibia: Michelle McLean (1992)

In 1992, Michelle McLean from Namibia made history by becoming the first Miss Universe from Namibia. At just 19 years old, Michelle’s radiant charm and poise won over the judges. Her victory was especially significant as Namibia had only recently gained independence in 1990. Michelle used her platform to champion humanitarian causes, including education and child welfare, leaving an enduring legacy in her country and beyond. 

 2. Botswana: Mpule Kwelagobe (1999)

Mpule Kwelagobe made Botswana proud when she clinched the Miss Universe crown in 1999. Her win was ground-breaking, as it marked the first time Botswana participated in the competition. Known for her intelligence and eloquence, Mpule impressed judges during the final question round by discussing pressing global issues like HIV/AIDS. Since her victory, she has become a global advocate for health and development, cementing her status as an inspirational figure in Africa and worldwide.

 3. South Africa

South Africa has a remarkable history at Miss Universe, boasting three titleholders: 

Margaret Gardiner (1978): Margaret became the first South African and African woman to win Miss Universe. Her timeless beauty and elegance set a high standard for future contestants.

Demi-Leigh Nel-Peters (2017): Known for her empowering speech on self-defense and women’s rights, Demi-Leigh captured the crown with her confidence and determination.

Zozibini Tunzi (2019): Zozibini’s victory was a landmark moment, celebrating natural beauty and African heritage. Her advocacy for gender equality and her embrace of her natural hair inspired women across the globe, redefining conventional beauty standards.

Leila Lopes, crowned Miss Universe in 2011, brought pride to Angola with her graceful demenour and stunning beauty. She used her platform to promote environmental sustainability and HIV/AIDS awareness in Angola.

By Faith Omoboye, Business Daily