South Africa cuts interest rates
19 November 2010
South Africa's four major commercial banks – Standard Bank, Nedbank, FNB and Absa – have dropped their interest rates by half a percentage point following Thursday's announcement by the SA Reserve Bank of a 50 basis point cut in its key repo rate.
"Standard Bank will be decreasing its prime and home loan base lending rates from 9.5 percent to nine percent, effective Friday 19 November 2010," the bank said in a statement.
These rate changes would apply to new and existing clients.
"Nedbank has announced a 50 basis point decrease in their prime overdraft rate, the vehicle and asset finance rate and the mortgage rate applicable to home loans, from 9.5 percent to 9 percent," Nedbank said in a statement.
"The interest rate for both new and existing vehicle and asset finance loans, as well as new and existing home loans will decrease with effect, 19 November 2010."
First National Bank will cut its prime lending rate by 0.5 percent from 9.5 percent to 9 percent. The new interest rate will be applicable to all new and existing prime linked loans, including home loans, from Friday.
"The monetary authorities are responding to unusual conditions in international financial markets. I believe that the cut is responsible and will modestly stimulate our economy," said Michael Jordaan, CEO of FNB, in a statement.
Absa would also drop its rates from Friday.
"On the back of this latest cut in the repo rate, Absa announced that its lending rates to the public, i.e. prime and variable mortgage rates, will decline by the same magnitude to a level of nine percent, effective from 19 November 2010," the bank said in a statement.