MASERU - Lesotho Post Bank has lowered its prime lending rate from 8.75 percent to 8.25 percent effective from May 27.

The decision comes shortly after the Central Bank of Lesotho (CBL) reduced the CBL rate from 4.25 percent to 3.75 percent per annum.

The CBL stated last week when presenting the Monetary Policy Committee statement that the rate set at this level will ensure that the domestic cost of borrowing and lending will be aligned with the cost funds elsewhere in the region.

Lesotho Post Bank explained in an interview with Metro on Wednesday that the lower prime lending rate simply means customers will enjoy the benefits and afford credit which they could otherwise not.  

On the side of the bank it means that the return that the bank makes on loans will be lower than what it used to get.

“Lower prime lending rate is good news for the customers and I can safely say the bank is happy because we are here to serve customers. On the side of the bank it means the return on loans will be lower than what we are used to getting under normal circumstances,” Lesotho Post Bank head of Wholesale Banking Nare Matsoha said.  

He showed that such a decision normally comes to effect in times of crises such as the current Covid-19 pandemic that has devastated the entire world economies.