UPDATE 1-Brazil central bank eases reserve requirements to pre-2008 levels

(Adds details of measures, comments from central bank director)

BRASILIA/SAO PAULO, March 28 (Reuters) - Brazil's central bank said on Wednesday it would ease reserve requirements on savings and checking accounts in a move to free up some 25.7 billion reais ($7.7 billion) for new lending in an effort to bring down some of the world's highest interest rates.

The central bank said the changes, which will take effect in late April or early May, would return reserve requirements on savings accounts to levels last seen before the 2008 global financial crisis. Reserve requirements on checking accounts will fall to 25 percent, from 40 percent currently.

Central Bank Director Otávio Damaso told a news conference that the measures created conditions for banks to reduce interest rates on loans, without mentioning specific targets. Lower reserve requirements are a longstanding demand from banks.

The central bank also set the rules for banks to issue covered bonds, a kind of deposit that could boost mortgage lending.

In a move to promote competition in the banking market, the central bank set rules to allow smaller financial companies to access services provided by banks, such as automatic debit and transfers between institutions. Financial technology startups, known as fintechs, have been pushing in Brazil for such changes.

Last week, Brazilian antitrust watchdog Cade said it would investigate anticompetitive practices by the country's banks following a complaint by Nubank, the biggest fintech in Brazil.

($1 = 3.32 reais) (Reporting by Marcela Ayres and Carolina Mandl Writing by Carolina Mandl; Editing by Sandra Maler and James Dalgleish)