The Central Bank of Kenya building in Nairobi. FILE
By GEOFFREY IRUNGU
The Treasury has cut its overdraft balance at
the Central Bank of Kenya for the first time since September last year,
as the regulator also stepped up efforts to ease cash shortage in the
financial market.
The latest CBK weekly report shows the overdraft
dropped by Sh7.4 billion or 22 per cent to Sh26.8 billion compared to
the previous week’s Sh34.2 billion.
The emergency loan to the government has been
rising since September and had stood at the maximum limit of Sh34.2
billion in recent weeks before the fall last week.
The overdraft facility for government is often
used to finance pressing expenditure, including payment of salaries,
pensions and maturing debt.
The loan facility, set at a statutory maximum of
five per cent of the revenue of the most recently audited government
annual accounts, is supposed to be fully cleared by the end of every
financial year.
The weekly report says CBK also stayed out of the interbank market in the week ending January 8.
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