Co-operative Bank Revises Loan Interest Rates as New Pricing Model Takes Effect

The Co-operative Bank has announced it will revise its loan interest rates following the implementation of a new Risk-Based Credit Pricing Model, in line with recommendations from the Central Bank of Kenya (CBK).

In a notice dated Thursday, January 29, 2026, the bank said it will transition all existing variable-rate Kenya Shilling-denominated loans to the new model starting February 28, 2026.

The new pricing model uses the Kenya Shilling Overnight Interbank Average (KESONIA) as the reference rate for all variable-rate loans. Interest rates will now be determined by KESONIA plus a customer-specific premium, which will automatically adjust each month as published by the CBK.

“We are pleased to inform our customers that all existing variable-rate loans will transition to the KESONIA-based model from February 28, 2026,” the bank said in the notice.

Co-operative Bank to Transition to New Pricing Loan Model

Furthermore, the bank assured its customers that it will continue to provide affordable credit facilities while ensuring competitive interest rates, and it expressed gratitude for their ongoing trust as their preferred financial partner.

“Co-op Bank remains committed to providing accessible and cost-effective credit solutions and thanks our customers for their continued trust,” the bank said.

Also Read: KCB Bank Announces New Interest Pricing for Existing Loans- What it Means

At the same time, the bank advised customers to contact their Relationship Manager, Personal Banker, Business Banker, or any branch nationwide for more information. Customers were also given the option to reach the bank’s 24/7 contact center via WhatsApp or phone.

“For details on this, please reach out to our 24/7 contact center via WhatsApp +254 736 690 101, Tel 020-277 000/0703 027 000, or liaise with your Relationship Manager, Personal Banker, Business Banker, or Branch Manager or any of our branches countrywide,” added the Cooperative Bank.

Also Read: CAK Approves KCB Riverbank Acquisition With Conditions

KCB Announces Changes on How Interest on Existing Loans Will be Calculated

Cooperative Bank’s statement comes a day after KCB Bank also made a similar announcement, stating changes to how interest on existing loans will be calculated, following the implementation of a revised Risk-Based Credit Pricing Model (RBCPM) in line with directives from the Central Bank of Kenya (CBK).

In a notice dated Wednesday, January 28, 2026, the lender said the new pricing framework, which has been in use for new loan facilities since December 1, 2025, will now be extended to cover existing Kenya Shilling-denominated variable-rate loans.

“We hereby notify all customers with running local currency loan contracts that were issued on or before November 30, 2025, that the new RBCPM will be applied to any portion of their facilities that remain outstanding as at February 28, 2026,” read part of the notice.

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The Central Bank of Kenya building in Nairobi. PHOTO/Print