Banks keep lending costs high despite CBN’s rate cut

By Uche Usim
Commercial banks have yet to reduce their lending rates nearly one week after the Central Bank of Nigeria (CBN) cut its benchmark interest rate by 350 basis points.
Tongues are wagging as many wonder when borrowers will begin to feel the impact of the policy change.
The CBN, at its Monetary Policy Committee (MPC) meet ing on September 22, cut the Monetary Policy Rate (MPR) from 26.5 per cent to 23 per cent, its biggest single reduction in nearly two decades.
However, checks reveal that lending rates across banks remain high, ranging from about 20 per cent to as much as 46 per cent, depending on the borrower’s risk profile, the bank’s funding cost and its pricing m...