Banking Industry Challenges Economic Downturn So Far | Banking/Finance

The BoG however noted that in its latest survey of credit conditions conducted in October 2022, commercial lenders are expecting to persist with tightening credit to businesses and households over the next six months.

“This is expected to reflect in a steady increase in average lending rates and a marginal decline in credit demand by enterprises and households,” Dr. Addison added.

Already, the interbank weighted average rate has increased to 23.98 percent in October 2022 from 12.66 percent a year ago – in tandem with hikes to the monetary policy rate and central bank-mandated hikes in the Cash Reserve Ratio from 12 percent in August 2022 to 14 percent in October.

As such, average lending rates across the industry rose from 20.34 percent to 31.4 percent YoY.