March 28, 2020 / 12:10 AM / 4 months ago

Canada's top lenders cut prime rates after central bank's surprise move

File Photo: The Royal Bank of Canada (RBC) logo is seen outside of a branch in Ottawa, Ontario, Canada, February 14, 2019. REUTERS/Chris Wattie

TORONTO (Reuters) - Canada’s top lenders lowered their prime rates by 50 basis points on Friday, hours after the central bank unexpectedly cut its key interest rate to help the county weather the economic fallout of the coronavirus pandemic.

Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia , Bank of Montreal and Canadian Imperial Bank of Commerce all cut their prime rates to 2.45%, effective March 30.

The Bank of Canada cut its overnight interest rate by 50 basis points to 0.25%, its lowest level since June 2010 and the third cut in March.

Separately, Canada’s financial regulator eased its capital and liquidity requirements for banks, changed credit loss provisioning and allowed more loans to be securitized.

The pandemic has forced several governments to take actions as businesses grind to a halt and several retailers close stores to curb the spread of the highly-contagious diseases, leaving many people jobless.

To date, Canada has reported 4,689 coronavirus cases and 53 deaths.

The U.S. Federal Reserve has also cut interest rates twice in less than two weeks in March, emergency moves to help shore up the economy in the face of the damage caused by the virus.

Reporting by Nivedita Balu in Bengaluru; Additional reportying by Nichola Saminather in Toronto; Editing by Sriraj Kalluvila and Daniel Wallis

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