Market News

Stanbic IBTC Bank has notified its retail, commercial and corporate customers of changes in interest rates, following the Central Bank of Nigeria’s (CBN) decision to cut its benchmark Monetary Policy Rate (MPR) by 350 basis points.

The bank said the new rates took effect from September 22, 2026, the same day the CBN Monetary Policy Committee approved the reduction in the MPR from 26.50 percent to 23 percent.

The rate cut is expected to affect both loans and deposit products linked to the MPR, according to notifications sent to customers.

For borrowers, the reduction could lower interest payments on variable-rate loans, including commercial loans, overdrafts and mortgages whose pricing is linked to the CBN benchmark.

Commercial banks had previously priced some prime lending facilities at rates of about 27 percent to 30 percent. The reduction in the MPR is expected to put downward pressure on such rates as banks adjust their pricing to reflect the new benchmark.

However, depositors may also see lower returns on some interest-bearing accounts.

Stanbic IBTC said the repricing would affect products on both sides of its balance sheet. While borrowers may benefit from lower rates, customers holding variable-rate savings accounts, fixed deposits and call accounts may see reductions in the interest paid on their funds.

The CBN, at its September 21-22 meeting, reduced the MPR by 350 basis points to 23 percent in its first major rate cut after a prolonged period of tight monetary policy.

The committee also retained the Cash Reserve Ratio (CRR) for deposit money banks at 45 percent and adjusted the asymmetric corridor around the MPR to +50/-300 basis points.

The move marked a major shift in the central bank’s monetary policy stance as inflationary pressures showed signs of easing.

Stanbic IBTC’s repricing is an early example of how the CBN’s decision is being passed through to customers and the wider financial system.

The transmission of monetary policy through commercial banks is important because changes in the MPR affect the cost of borrowing, returns on savings, investment decisions and, ultimately, economic activity.

Lower lending rates could support businesses and households that rely on bank credit, although the actual benefit will depend on how quickly and fully banks pass the reduction on to customers.

At the same time, lower deposit rates could reduce returns for savers and investors who keep funds in interest-bearing bank accounts and other short-term instruments.

The development also highlights the balance banks must maintain between supporting credit growth and managing funding costs as the new lower interest-rate environment takes effect.