Zambia's Central Bank reduced statutory reserves lending rates from 8% to 5%.

By John Chola - 01/11/2011 Zambia's Central Banker (BoZ) has downed the statutory reserves Ratio from 8% to 5%. This means that the BoZ will release back a total of K700 billion to the Commercial Banks money it held for people who bank with commercial banks. This, according to experts, will result in immediate downward reductions of lending rates by commercial banks. Investrust Bank Plc yesterday decided to reduce its lending rates from 19% to 16% and Finance Bank Zambia Limited has today followed suit and reduced lending rates to a further 15%. The Central Bank PR department told this newswire that the BoZ has taken note wide spread concerns expressed about the high levels of base lending rates in the commercial banks and the consequence adverse effects on the affordability of growth enhancing credit by a number of productive sectors. The core liqud asset ratio has also been slashed from 9% to 6%. "With this reduction the cost of holding these assets will. similarly, be reduced," states a statement signed by Head PR, Kanguya Mayondi. The overnight lending facility has been reduced from 4 per centage points to two percentage points above the interbank rates. Ends