@StandardMedia

CBK halts borrowing of foreign currency from listed firms

2 months ago, 12 Oct 00:09

By: Otiato Guguyu

Listed firms were blocked by the Central Bank from issuing foreign currency debt over concerns of the stability of the shilling.

Top capital markets official said the regulator had expressed concerns over spikes in dollar demand when debts are repaid.

Currency matters are sensitive given that more than half of Kenya's debt is in foreign cash. Any volatile movements can spike the units of shillings needed to repay every dollar we have borrowed from abroad.

Central Bank did not also have an accommodative National Payment System to settle multi-currency payments.

“This is the second time we are trying to introduce this. The regulator was concerned to say one issues a Sh20 billion note and investors have to go to the market to get the dollar, the shilling will weaken, the same at the point of redemption,” said Capital Markets Authority Head of Strategy and Policy Jairus Muaka.

He spoke in Nairobi yesterday on the sidelines of a policy round-table meeting by market players to draft proposals to improve the Kenyan Capital Market effectiveness.

Mr Mwaka observed that the settlement system forced traders to convert foreign currencies to the shilling first. "To change a dollar to Euro, one must first change it to Kenyan shilling before conversion to other currencies since the settlement system was built around the shilling.

He said CBK asked for more time to analyse and adjust the payment system to cater for various currencies.

Market players want Treasury to allow securities issuance and trading to be in various currencies other than the shilling.


Read More


Category: business news topnews

Suggested

9 hours ago, 10:24
@CapitalFMNews - By: Wambui Waweru
British Airways announces return to Pakistan after a decade

ISLAMABAD, Pakistan, Dec 18 - British Airways will resume flights to Pakistan next summer, the carrier announced Tuesday, in a major vote of confidence Kenya breaking news | Kenya news today | ...

Category: business enterprise
12 hours ago, 07:46
@TheEastAfrican - By: Emmanuel Onyango
Uganda-Tanzania oil pipeline project in stalemate

Investors are yet to make final investment decisions over the project. ...

Category: topnews news business
2 hours ago, 18:01
@AfricaNews - By: Jean David Mihamle
Special report: Ditadi 'green gold' | Africanews

Congo can also count on green gold for its economic take-off... ...

Category: africa africa_business business news
3 hours ago, 17:06
@CapitalFMNews - By: Kennedy Kangethe
HF Group Plc poaches Kibaara from NIC bank

NAIROBI, Kenya, Dec 18 - HF Group Plc has poached Robert Kibaara from NIC Bank appointing him as the new Group Chief Executive Officer. Kibaara takes over Kenya breaking news | Kenya news today | ...

Category: business
12 hours ago, 07:45
@CapitalFMNews - By: Kennedy Kangethe
Actis acquires 88 percent of 100MW Kipeto wind power project

NAIROBI, Kenya, Dec 18 - Emerging Market Investor Actis has acquired 88 percent of Kipeto energy making it the largest shareholder of the 100MW wind power Kenya breaking news | Kenya news today | ...

Category: business
2 hours ago, 18:02
@BusinessDaily -
Kenyan firms to supply Sh320m farm machines to DRC

The equipment include grain cleaners, dryers, seed processors, packaging machines and graders. ...

Category: business news

@StandardMedia

CBK halts borrowing of foreign currency from listed firms

2 months ago, 12 Oct 00:09

By: Otiato Guguyu

Listed firms were blocked by the Central Bank from issuing foreign currency debt over concerns of the stability of the shilling.

Top capital markets official said the regulator had expressed concerns over spikes in dollar demand when debts are repaid.

Currency matters are sensitive given that more than half of Kenya's debt is in foreign cash. Any volatile movements can spike the units of shillings needed to repay every dollar we have borrowed from abroad.

Central Bank did not also have an accommodative National Payment System to settle multi-currency payments.

“This is the second time we are trying to introduce this. The regulator was concerned to say one issues a Sh20 billion note and investors have to go to the market to get the dollar, the shilling will weaken, the same at the point of redemption,” said Capital Markets Authority Head of Strategy and Policy Jairus Muaka.

He spoke in Nairobi yesterday on the sidelines of a policy round-table meeting by market players to draft proposals to improve the Kenyan Capital Market effectiveness.

Mr Mwaka observed that the settlement system forced traders to convert foreign currencies to the shilling first. "To change a dollar to Euro, one must first change it to Kenyan shilling before conversion to other currencies since the settlement system was built around the shilling.

He said CBK asked for more time to analyse and adjust the payment system to cater for various currencies.

Market players want Treasury to allow securities issuance and trading to be in various currencies other than the shilling.


Read More

Category: business news topnews

Suggested

9 hours ago, 10:24
@CapitalFMNews - By: Wambui Waweru
British Airways announces return to Pakistan after a decade

ISLAMABAD, Pakistan, Dec 18 - British Airways will resume flights to Pakistan next summer, the carrier announced Tuesday, in a major vote of confidence Kenya breaking news | Kenya news today | ...

Category: business enterprise
12 hours ago, 07:46
@TheEastAfrican - By: Emmanuel Onyango
Uganda-Tanzania oil pipeline project in stalemate

Investors are yet to make final investment decisions over the project. ...

Category: topnews news business
2 hours ago, 18:01
@AfricaNews - By: Jean David Mihamle
Special report: Ditadi 'green gold' | Africanews

Congo can also count on green gold for its economic take-off... ...

Category: africa africa_business business news
3 hours ago, 17:06
@CapitalFMNews - By: Kennedy Kangethe
HF Group Plc poaches Kibaara from NIC bank

NAIROBI, Kenya, Dec 18 - HF Group Plc has poached Robert Kibaara from NIC Bank appointing him as the new Group Chief Executive Officer. Kibaara takes over Kenya breaking news | Kenya news today | ...

Category: business
12 hours ago, 07:45
@CapitalFMNews - By: Kennedy Kangethe
Actis acquires 88 percent of 100MW Kipeto wind power project

NAIROBI, Kenya, Dec 18 - Emerging Market Investor Actis has acquired 88 percent of Kipeto energy making it the largest shareholder of the 100MW wind power Kenya breaking news | Kenya news today | ...

Category: business
2 hours ago, 18:02
@BusinessDaily -
Kenyan firms to supply Sh320m farm machines to DRC

The equipment include grain cleaners, dryers, seed processors, packaging machines and graders. ...

Category: business news
Our App