Tag archives: Interest rates

SARB cuts the repo rate yet again: how does this affect borrowers and debt payments?

By Claire Friedman, Aviva Hoekstra and Jackie Midlane on May 24, 2020 Posted in Banking

Economists and business leaders have welcomed the South African Reserve Bank’s (SARB) decision to cut the repo rate by a further 50 basis points (bps) to 3.75% on 21 May 2020. This has resulted in a reduction of the prime rate quoted by our commercial banks from 7.75 % to 7.25 %. This is the … Continue reading

The decline of LIBOR and the new risk-free interest rates

By Steve Chemaly and Claire Friedman on March 12, 2020 Posted in Banking

The history of manipulation and scandals surrounding interbank offered rates (IBORs), for example LIBOR and JIBAR, has led to the shift toward Risk-Free Rates (RFRs), a shift which is primarily market led and remains uncertain. The transition to RFR’s rests on the fact that rates such as LIBOR are forward-looking interest rates, calculated using estimates … Continue reading