KCB Bank and Equity Bank have issued fresh notices announcing new loan pricing structures following the Central Bank of Kenya’s latest decision to revise the Central Bank Rate (CBR) to 9 percent.
In its announcement, KCB said the revision is aligned with its recently adopted risk-based pricing approach.
The bank noted that the changes will apply to new borrowers right away, while existing customers will transition within timelines set by the Central Bank.
"Following the latest adjustment of the Central Bank Rate (CBR) by the Central Bank of Kenya (CBK) to 9.0% and in line with the new Risk Based Credit Pricing Model (RBCPM) adopted from December 1, 2025, KCB Bank Kenya wishes to notify our customers and the public that;" the notice read.
KCB then outlined how new and existing loan facilities will be priced under the revised framework.
Read More
"New local currency denominated variable-rate loans taken from December 11, 2025, will be priced on a base rate of 9.0%. The final lending rate is based on a customer-specific margin, adjusted to the base rate, in line with the pricing model; All facilities applied for from December 1, 2025 will be adjusted accordingly upon the expiry of the 30-day notice period as required by CBK; All existing local currency variable-rate loans taken before December 1, 2025, will continue under the current terms and will transition to the (w fray awby the end of the CB-mandated transtion period; All applicable fees, charges, and the total cost of credit will be fully disclosed to customers in line with the CBK requirements," the notice added.
Equity Bank also issued its own customer notice confirming loan pricing changes that take effect immediately for new applications.
The bank indicated that its revised rates reflect the Monetary Policy Committee’s decision to lower the CBR from 9.25 percent to 9 percent.
"Following the revision of the Central Bank Rate (CBR) by the Monetary Policy Committee on 9th December 2025, we wish to notify you of the below changes;" the bank said.
Equity added that the new rate will apply to new borrowers and those who took loans earlier in the month.
"All new local currency variable-rate loans, effective 10th December 2025, will be priced under the revised CBR of 9%, plus the applicable customer premium (K). This change will also affect facilities issued after 1st December 2025, where such facilities pricing will accordingly be adjusted by the reduction in CBR from 9.25% to 9% effective immediately," the notice added.
For customers whose loans still reference the Equity Bank Reference Rate (EBRR), the lender outlined the transition timeline and customer notification process.
"For existing local currency variable-rate loans whose pricing is still based on the Equity Bank Reference Rate (EBRR), the transition to CBR will take effect by 28th February 2026. Customers whose facilities are scheduled for transition will be issued with a 30-Day notice and variation letters (where applicable) advising them on the change from the Equity Bank Reference Rate (EBRR) to the CBR, plus the applicable customer premium (K)," the notice concluded.
This comes days after CBK announced a reduction of the Central Bank Rate (CBR) by 25 basis points to 9 per cent from 9.25 per cent.
The adjustment was agreed upon during the Monetary Policy Committee (MPC) meeting held on December 9, 2025.
''The Monetary Policy Committee (MPC) decided to lower the Central Bank Rate (CBR) by 25 basis points to 9.00 per cent from 9.25 per cent, during its meeting held on December 9, 2025,'' CBK announced.
The MPC noted that the move comes at a time when global economic growth remains resilient, with a projection of 3.2 per cent in 2025, supported by strong consumer and business spending, especially in the United States.
CBK added that the ninth consecutive rate cut was influenced by a broader global trend in which central banks in major economies have cautiously eased monetary policies in response to varied inflation and growth conditions.
The regulator further highlighted that international oil prices have eased due to increased production and subdued global demand, although volatility persists amid ongoing global uncertainties.
The bank also reported reduced food inflation globally, driven by lower prices of cereals, sugar, and edible oils, which have contributed to easing overall price pressures.
