The announcement of the receivership of Chase Bank Limited on Thursday 7th April 2016 by the Central Bank of Kenya (CBK), was received with surprise by Kenyans as the bank had emerged as “Bank Best Company to Work for in Kenya 2015 ”.
The trends of interest rates above demonstrate that commercial banks have maintained a much higher lending rate than the saving rates. For example, in January 2014, the difference between the lending and saving rate by commercial banks was 15.47%. In December 2015, the difference was 16.75% implying that the gap has widened. The difference is observed to have increased despite CBK rate having been raised from 8.5% to 11.5%. This shows that banks continue to earn more credit from the issued loans while depositors earn little interest from their deposits. There is therefore a high need for CBK to fully exercise its supervisory mandate of protecting the depositors through various measures such as maintaining a minimum reserve requirement.
[1] https://www.centralbank.go.ke/images/docs/media/Press%20Releases/ChaseBankLimited.pdf [2] https://www.chasebankkenya.co.ke/about/awards/chase-bank-best-company-work-kenya-2015 [3] http://www.nation.co.ke/news/How-whistle-blower-letter-brought-Chase-Bank-to-its-knees/-/1056/3152818/-/9tl34d/-/index.html
While Kenya has long implemented the NHIF (National Hospital Insurance Fund) whose core mandate is to provide medical insurance coverage to all its members and their declared dependants and also to make medical care affordable, enrolment rates, particularly in the voluntary and informal sectors, remain low. Yet, NHIF is the most common type of health […]
Introduction According to the United Nations, Double Taxation Agreements (DTAs) are “bilateral agreements between two countries which allocate taxing rights over income between those two countries thereby preventing double taxation of income. The main objective of DTAs therefore, is to prevent and or eliminate avoidance and evasion of taxes on income and capital by both […]
Courts as Monopolies Access to justice is fundamental in any democratic society, ensuring individuals can pursue their legal rights and seek redress for grievances. However, when courts operate as monopolies, it can have implications for access to justice. Monopolies have exclusive control or dominance over a particular market or industry. Courts are monopolies because they […]
Introduction Public policies are formulated to achieve specific societal outcomes, and when their implementation is delayed or falls short, it can lead to significant adverse consequences on the overall functioning of the system they are designed to govern. Implementation delays in government policies can occur for various reasons. These include intricate and protracted bureaucratic implementation […]
Introduction Every year since 2007, various countries around the world come together to celebrate Data Privacy Day, observed on the 28th of January. For Kenya, this day commemoration, spearheaded by the Office of the Data Protection Commissioner, brings together Data controllers, industry players, consumers and businesses. The theme for the 2024 celebration is: ‘Fostering a […]
Post date: Fri, May 6, 2016 |
Category: Finance |
By: Noah Wamalwa, |
The announcement of the receivership of Chase Bank Limited on Thursday 7th April 2016 by the Central Bank of Kenya (CBK), was received with surprise by Kenyans as the bank had emerged as “Bank Best Company to Work for in Kenya 2015 ”.
The trends of interest rates above demonstrate that commercial banks have maintained a much higher lending rate than the saving rates. For example, in January 2014, the difference between the lending and saving rate by commercial banks was 15.47%. In December 2015, the difference was 16.75% implying that the gap has widened. The difference is observed to have increased despite CBK rate having been raised from 8.5% to 11.5%. This shows that banks continue to earn more credit from the issued loans while depositors earn little interest from their deposits. There is therefore a high need for CBK to fully exercise its supervisory mandate of protecting the depositors through various measures such as maintaining a minimum reserve requirement.
[1] https://www.centralbank.go.ke/images/docs/media/Press%20Releases/ChaseBankLimited.pdf [2] https://www.chasebankkenya.co.ke/about/awards/chase-bank-best-company-work-kenya-2015 [3] http://www.nation.co.ke/news/How-whistle-blower-letter-brought-Chase-Bank-to-its-knees/-/1056/3152818/-/9tl34d/-/index.html
While Kenya has long implemented the NHIF (National Hospital Insurance Fund) whose core mandate is to provide medical insurance coverage to all its members and their declared dependants and also to make medical care affordable, enrolment rates, particularly in the voluntary and informal sectors, remain low. Yet, NHIF is the most common type of health […]
Introduction According to the United Nations, Double Taxation Agreements (DTAs) are “bilateral agreements between two countries which allocate taxing rights over income between those two countries thereby preventing double taxation of income. The main objective of DTAs therefore, is to prevent and or eliminate avoidance and evasion of taxes on income and capital by both […]
Courts as Monopolies Access to justice is fundamental in any democratic society, ensuring individuals can pursue their legal rights and seek redress for grievances. However, when courts operate as monopolies, it can have implications for access to justice. Monopolies have exclusive control or dominance over a particular market or industry. Courts are monopolies because they […]
Introduction Public policies are formulated to achieve specific societal outcomes, and when their implementation is delayed or falls short, it can lead to significant adverse consequences on the overall functioning of the system they are designed to govern. Implementation delays in government policies can occur for various reasons. These include intricate and protracted bureaucratic implementation […]
Introduction Every year since 2007, various countries around the world come together to celebrate Data Privacy Day, observed on the 28th of January. For Kenya, this day commemoration, spearheaded by the Office of the Data Protection Commissioner, brings together Data controllers, industry players, consumers and businesses. The theme for the 2024 celebration is: ‘Fostering a […]