JN Bank says it is raising interest rates on some customers’ loans effective June 9, citing the hike in the Bank of Jamaica (BOJ) policy interest rate.

The rate adjustments will affect some mortgagors; auto loans and some business loans.

“Members who received their loan disbursement less than six months prior to the effective date of the June 9 rate increase have not been affected,” the bank said in response to questions from OBSERVER ONLINE.

Affected mortgagors will see an increase ranging from 0.25 percentage points to 0.75 percentage points on their loans, while the rates of affected auto loans will rise by 0.5 percentage points. Affected business loans will attract an increase in rates ranging from 0.5 percentage points to 0.75 percentage points, the bank said.

In explaining its decision to increase rates, the bank noted that the BOJ since September 2021 has increased its policy interest rate from 0.5 per cent to 4.5 per cent per annum.

“As a result, market interest rates and the cost of deposits have risen. Over the period, JN Bank absorbed the increased costs. However, regrettably, we are unable to continue to do so, hence we have implemented these slight adjustments in rates on some loans,” the bank said.

Mortgage rates at JN Bank, the largest private holder of mortgage accounts locally, now range from 6.85 per cent to 8.5 per cent.

Auto loan rates range from 7.5 per cent to 9.5 per cent on new cars, and nine per cent to 10.75 per cent on used cars.