ComBank reduces lending rates in quick response to COVID-19 crisis

• Announces across-the-board reduction of rates encompassing all categories of loans, leases, pawning and OD facilities

Commercial Bank of Ceylon has announced a reduction of lending rates across the board in response to the present needs of individual and corporate borrowers and in line with the downward trend of interest rates in Sri Lanka. 

Effective immediately, the rate cut encompasses all categories of new loans offered by Sri Lanka’s benchmark private sector bank and includes pawning, leases and overdrafts.

The rate cuts are intended to help support the bank’s customers who are affected by the shutdown of businesses and the consequent revenue losses due to the COVID-19 pandemic.

“No one has been spared the adverse effects of the pandemic and virtually every customer segment and every sector of business is crying out for relief,” Commercial Bank Managing Director S. Renganathan said. 

“The banking sector is similarly impacted but we have to rise to the occasion and do whatever we can to ease the burden on customers and the national economy. 

This rate cut is just one of many initiatives Commercial Bank is taking to help revive businesses and ease the burden on individuals in these challenging times.”

Detailing the rate cuts, the bank said the rates on Agribusiness Loans have been cut by 2 percent, reducing the rates applicable to five and seven-year loans to 12 percent and 13 percent, respectively, while the rate on ‘Diribala’ loans designed for SMEs and micro enterprises, has also been slashed by 2 percent for both five and seven-year tenures to 11.5 percent and 12.5 percent, respectively. 

The interest rate on Home Loans has been slashed by 1.5 percent for 10-year loans and by one percent for over 10 years, bringing the rates down to 11 percent and 12 percent per annum, respectively, easing the pressure on a key segment of borrowers, the bank disclosed. Leasing, Biz Loan and Personal Loan customers benefit from reductions of 1.5 percent, 0.5 percent and 0.5 percent in their respective rates of interest.

The bank said the rate on overdrafts has been cut by 2 percent to 12 percent per annum and by 1.5 percent to 11 percent for other fixed loans. Meanwhile, Green Loans and Leases that support conversion to renewable energy and investment in other eco-friendly practices will also cost less, with reductions of up to 1.5 percent in the interest rates applicable.

The bank has also taken the initiative to further reduce the Pawning interest rate to 11 percent p.a., which is lower than the rate of 12 percent stipulated by the Central Bank of Sri Lanka. 

In April, Commercial Bank of Ceylon announced a series of concessions for borrowers whose loans had already been classified as non-performing based on a Central Bank of Sri Lanka relief package for COVID-19-affected borrowing customers. In addition, the bank has offered several concessions for its credit card holders, including a special card repayment plan for outstanding balances. The bank has started accepting applications for special working capital loans introduced by the Central Bank of Sri Lanka, offered at 4 percent interest rate to self-employed people and business entities.