Regulatory Alerts2016-10-25 | 129980586Banking Circular No 7 of 2009 - Adjustment of Central Bank Rate (CBR) and Cash Reserve Ration (CRR)
The Central Bank of Kenya lowered the Central Bank Rate and the Cash Reserve Ratio by 25 basis points and 0.5 percentage points, respectively, during its Monetary Policy Committee meeting on July 22, 2009. The bank also lengthened the tenor for repo transactions from 5 to 7 days and advised banks to prioritize interbank and horizontal repo opportunities before applying for reverse repo. These changes took effect immediately.
CENTRAL BANKI BANK OF KUU YA KENYA KENYA Haile Selassie Aven P. O. Box 60000 - 00200 Nairobi Kenya Telephone: 2860000 Telex: 223 July 23, 2009 BANKING CIRCULAR NO.7 OF 2009 TO: ALL CHIEF EXECUTIVES OF COMMERCIAL BANKS ADJUSTMENT OF: CENTRAL BANK RATE (CBR) AND CASH RESERVE RATIO (CRR) This is to inform all commercial banks that the Monetary Policy Committee (MPC) at its meeting on July 22, 2009 reviewed the CBR downwards by 25 basis points from 8.0 percent to 7.75 percent and also lowered the cash reserve ratio from 5 percent to 4.5 percent.
In addition, the tenor for repo transactions was lengthened from 5 days to 7 days. All the announced changes take effect immediately.
The Central Bank of Kenya also wishes to advise banks that whenever it announces an offer for reverse repo, its expectation is that interested banks will have exhausted their interbank and Horizontal repo opportunities first before applying for reverse repo.
A. NYAOMA DIRECTOR, BANKING SERVICES DEPARTMENT