State overdraft at CBK hits Sh23bn - 3 months ago, 8 Nov 16:08
The national government overdraft at the Central Bank of Kenya (CBK) rose at the end of October to the highest level in four weeks.
The overdraft, which is an equivalent of emergency lending to the Treasury, stood at Sh23.44 billion as at October 26 compared to Sh4.33 billion in the previous week.
In the two weeks preceding October 19, the national government had incurred no credit from the CBK, according to data from the monetary authority.
The CBK lends to the central government whenever the latter has liquidity shortage, easing such urgent payment requirements such as salaries and other recurrent expenditure such as debt repayments.
The emergency lending, which is regarded as direct creation of cash by the CBK, is supposed to be restricted to a maximum of five per cent of the most recently audited revenues. It is supposed to be repaid by the end of the fiscal year.
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