Dr Susan Koech get interbank working as Opus Dei on terminal leave?

[RV Pundit]

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There is a bit of easing of the dollar shortages as the interbank market slowly reopens. BD reporting how the lines of communication between banks and the CBK have helped reopen the market.

"The reopened lines of communication have helped improve the volume of dollars to the… pic.twitter.com/kTI2rrvCPt

— Mwango Capital (@MwangoCapital) March 28, 2023

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[hk]

CBK was forced to open interbank to ease dollar shortage and squash parallel exchange rate. Interbank was closed to protect the Ksh. or manage depreciation. Just like interest controls, this are short term solution that eventually markets obliterates . Now CBK will be forced to raise interest rates, market has refused to buy 364 days bonds at the rates being offered which means hustler fund has to either raise interest rates or it wont be sustainable.

[RV Pundit]

Yes our inflation and base rates look suspiciously low considering UK has inflation of 10%.
It times we face our demons.
The early the better.

CBK was forced to open interbank to ease dollar shortage and squash parallel exchange rate. Interbank was closed to protect the Ksh. or manage depreciation. Just like interest controls, this are short term solution that eventually markets obliterates . Now CBK will be forced to raise interest rates, market has refused to buy 364 days bonds at the rates being offered which means hustler fund has to either raise interest rates or it wont be sustainable.

[sema]

Ndii has been praising the hustler fund for it's "ability" to hand out low interest loans.  Was he not aware this would eventually happen?

[hk]

Ndii has been praising the hustler fund for it's "ability" to hand out low interest loans.  Was he not aware this would eventually happen?

Its subsidized and Ndii doesn't mind since its regime crowning initiative up to now. If you listen to him closely he has shifted from cheap loans to giving hustlers "dignity".

[sema]

Ndii said the problem he had was that the government was lending to banks at 8% and banks were lending to hustlers at 20/30% so, he wants the banks to lend to hustlers at the same rates that they are getting from the GOK.

[RV Pundit]

Gov borrows from Banks & rich kenyans - at btw 8% -14%.
Hustlers borrows from Banks - from anyting 20% to 360% (some were quoting daily rate of 1%) - as they are riskier
At such high interest rate - access & cost of credit - hurt hustlers (the poor) even more.
Solution - Hustler Fund - derisking the credit for the poor.
Gov borrows from Banks - hand it over to Hustle 8-10% - and shoulder the risk.

So gov is prepared therefore to take losses - that banks are unwilling.

In hope Hustlers life will dramatically improve with access to cheap labour - and they will eventually grow enough to pay taxes - to be used to de-risk even more credit.

Ndii said the problem he had was that the government was lending to banks at 8% and banks were lending to hustlers at 20/30% so, he wants the banks to lend to hustlers at the same rates that they are getting from the GOK.

[hk]

Gov borrows from Banks & rich kenyans - at btw 8% -14%.
Hustlers borrows from Banks - from anyting 20% to 360% (some were quoting daily rate of 1%) - as they are riskier
At such high interest rate - access & cost of credit - hurt hustlers (the poor) even more.
Solution - Hustler Fund - derisking the credit for the poor.
Gov borrows from Banks - hand it over to Hustle 8-10% - and shoulder the risk.

So gov is prepared therefore to take losses - that banks are unwilling.

In hope Hustlers life will dramatically improve with access to cheap labour - and they will eventually grow enough to pay taxes - to be used to de-risk even more credit.

Ndii said the problem he had was that the government was lending to banks at 8% and banks were lending to hustlers at 20/30% so, he wants the banks to lend to hustlers at the same rates that they are getting from the GOK.

Government is borrowing at 10% on 91 day Tbill 364 14% so taxpayers are subsidizing the fund 2%minimum plus the cost of running the fund by kcb and family bank. There's no derisking the risk is transferred to the public, its a social fund. What's even worse the savings interest is less than government is paying to borrow.  The solution should be to lower interest rates and banks can offer loans at a cheaper rate.  Instead of a market sustainable solution government opted for government solution.

[RV Pundit]

How can it be social fund when borrowers are repaying - saving and putting in some pension.
The gov funding to it is capped at 50B - per annum.
Thanks to tech - this revovling fund - is being borrowed every often - it will reach a time - people will borrow daily 100B - like Fuliza.

Even during Kibaki time - with borrowing spree - few banks ever lent to the very bottom - they all follow salaried people.

Even for Equity bank and micro-finance - there is a level of risk they cannot stomach.

Hustler Fund is for me one of signature project Ruto should keep increasing it's funding.

And hopefully it will force other digital loans to go slow on interest - good competition.

Government is borrowing at 10% on 91 day Tbill 364 14% so taxpayers are subsidizing the fund 2%minimum plus the cost of running the fund by kcb and family bank. There's no derisking the risk is transferred to the public, its a social fund. What's even worse the savings interest is less than government is paying to borrow.  The solution should be to lower interest rates and banks can offer loans at a cheaper rate.  Instead of a market sustainable solution government opted for government solution.

[RV Pundit]

HK you were right - reality is starting to stare at us

The Central of Kenya [@CBKKenya] raises rates by a whopping 75 basis points to 9.5% from 8.75%.

What that practically means is that the costs of loans from banks are about to go up. pic.twitter.com/Z7x2dOIX5m

— Mwango Capital (@MwangoCapital) March 29, 2023

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[sema]

Government is borrowing at 10% on 91 day Tbill 364 14% so taxpayers are subsidizing the fund 2%minimum plus the cost of running the fund by kcb and family bank. [/quote

hii ni kizungu kubwa.  Can you explain to us what this means in simple English? talk to me like I am a hustler in mukuru kwa njenga

[Georgesoros]

So taking a mortgage is like 20%??

[RV Pundit]

Position advertised..opus dei did excellent job in difficult environment where Kenyatta vampire was keen to profit

Now that the positions have been advertised, some two lucky Kenyans will join Susan Koech [@koech_sk] at the top of the CBK management team.

Who do you think will serve as the next CBK Governor and Deputy Governor? #MwangoChat https://t.co/qmZdDdJah0

— Mwango Capital (@MwangoCapital) March 30, 2023

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[hk]

HK you were right - reality is starting to stare at us

The Central of Kenya [@CBKKenya] raises rates by a whopping 75 basis points to 9.5% from 8.75%.

What that practically means is that the costs of loans from banks are about to go up. pic.twitter.com/Z7x2dOIX5m

— Mwango Capital (@MwangoCapital) March 29, 2023

?s=20

It was inevitable that interest rates had to be raised.  CBK is trying to both tame inflation and also shore up KSH. The genesis of all this problems is debt crisis  due to over borrowing. The economy needs an impetus to recover, we might as well bite the bullet and seriously slash spending(including layoffs), deregulate and liberalize.

[Georgesoros]

It was inevitable that interest rates had to be raised.  CBK is trying to both tame inflation and also shore up KSH. The genesis of all this problems is debt crisis  due to over borrowing. The economy needs an impetus to recover, we might as well bite the bullet and seriously slash spending(including layoffs), deregulate and liberalize.
[/quote]

Even in our daily lives we have to go on a serious diet. Kenya's economy needs reinvention. Spending cuts are necessary so as to regenerate necessary and critical sectors.

[Kadudu]

Pundit always insisted that borrowing is not bad. Even the Eurobonds that were borrowed as infrastructure bonds but ended up somewhere else were titled as necesscity by Pundit. Now we cannot borrow any more and our uncle IMF has to bail us out. Come 2024 and kenya has to cough out US$ 2 Billion. At the current rate Ksh. 260 billion!

It was inevitable that interest rates had to be raised.  CBK is trying to both tame inflation and also shore up KSH. The genesis of all this problems is debt crisis  due to over borrowing. The economy needs an impetus to recover, we might as well bite the bullet and seriously slash spending(including layoffs), deregulate and liberalize.

Even in our daily lives we have to go on a serious diet. Kenya's economy needs reinvention. Spending cuts are necessary so as to regenerate necessary and critical sectors.
[/quote]

[RV Pundit]

Be factual.
Yes borrowing is okay
But we overleveraged.
When we got near 70% I told Uhuru STOP IT
And focus on privitisation
Sell our prized cows like Safaricom to continue development.
He did NOT stop. He did not sell.

Ruto has to stop borrowing. Heck no one lending us anyway.

But we have to find MONEY to fund the budget and development. Otherwise we go to MOI ERA.

Money will come from Private Invesmtnet (PPP)s and of course Privitisation (sell companies).

Where I totally disagree with HK is that gov of kenya should cut spending - stop building things - stop paying salaries.

The wheels of development should spin - because once you lose the momentum - it become difficult to get it going.

Things will become rusted, pending pills, delayed bills - and of course economy will crush.

Pundit always insisted that borrowing is not bad. Even the Eurobonds that were borrowed as infrastructure bonds but ended up somewhere else were titled as necesscity by Pundit. Now we cannot borrow any more and our uncle IMF has to bail us out. Come 2024 and kenya has to cough out US$ 2 Billion. At the current rate Ksh. 260 billion!