Banking Circular No 7 of 2009 - Adjustment of Central Bank Rate (CBR) and Cash Reserve Ration (CRR)

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