wazua Sun, Dec 16, 2018
Welcome Guest Search | Active Topics | Log In | Register

135 Pages«<120121122123124>»
Law Capping interest rates
obiero
#2421 Posted : Friday, March 09, 2018 10:06:28 AM
Rank: Elder


Joined: 6/23/2009
Posts: 10,937
Location: nairobi
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.

That's the whole truth. Note is that retail segment was not affected at all but the SME and corporate are driving the repeal agenda. Not even because of the 14% but the 7% floor
DISCLAIMER: @obiero, MBA-MIS, CISA. Opinionated, owner of www.winda.co.ke. Aims to be factual
KulaRaha
#2422 Posted : Friday, March 09, 2018 10:13:26 AM
Rank: Elder


Joined: 7/26/2007
Posts: 6,357
Ericsson wrote:
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.


But will enable GoK/Rotich access to $1.5bn from IMF


They've never used that facility for as long as they've had it...

And it's not like it's another loan to spend on useless projects...

Waste of time imo
Business opportunities are like buses,there's always another one coming
KulaRaha
#2423 Posted : Friday, March 09, 2018 10:15:48 AM
Rank: Elder


Joined: 7/26/2007
Posts: 6,357
obiero wrote:
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.

That's the whole truth. Note is that retail segment was not affected at all but the SME and corporate are driving the repeal agenda. Not even because of the 14% but the 7% floor


tbh rate cap saved banks from huge unsecured bad debt portfolios...imagine Kenyans who had borrowed to buy tvs/empty plots and drinks on weekends trying repay in the current economic environment...

Business opportunities are like buses,there's always another one coming
Ericsson
#2424 Posted : Friday, March 09, 2018 10:24:57 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,875
Location: NAIROBI
KulaRaha wrote:
obiero wrote:
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.

That's the whole truth. Note is that retail segment was not affected at all but the SME and corporate are driving the repeal agenda. Not even because of the 14% but the 7% floor


tbh rate cap saved banks from huge unsecured bad debt portfolios...imagine Kenyans who had borrowed to buy tvs/empty plots and drinks on weekends trying repay in the current economic environment...



Wangelipa tuu.
We were there during Kibaki second term and treasury and banks came into an agreement to prevent a crisis
winmak
#2425 Posted : Friday, March 09, 2018 11:02:07 AM
Rank: Member


Joined: 12/1/2007
Posts: 390
Location: Nakuru
KulaRaha wrote:
obiero wrote:
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.

That's the whole truth. Note is that retail segment was not affected at all but the SME and corporate are driving the repeal agenda. Not even because of the 14% but the 7% floor


tbh rate cap saved banks from huge unsecured bad debt portfolios...imagine Kenyans who had borrowed to buy tvs/empty plots and drinks on weekends trying repay in the current economic environment...



CHicken-egg... part ot 'the current environment' is due to low credit uptake due to stringency of the banks in giving loans (no pricing in risk)
For investors as a whole, returns decrease as motion increases ~ WB
wukan
#2426 Posted : Friday, March 09, 2018 11:23:07 AM
Rank: Veteran


Joined: 11/13/2015
Posts: 902
KulaRaha wrote:
Ericsson wrote:
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.


But will enable GoK/Rotich access to $1.5bn from IMF


They've never used that facility for as long as they've had it...

And it's not like it's another loan to spend on useless projects...

Waste of time imo


We got into this rate cap mess because of the lack of such a facility. In 2015 the currency came under speculative attack because CBK ran out of reserves trying to burn speculators(yours truly includedsmile ). CBK played the same 2011 rule book by hiking t-bill rates and banks hiked interest rates so that you couldn't borrow from the banks @13% to buy the tbills at 26%.

A standby facility is crucial especially with our trade deficit position.
KulaRaha
#2427 Posted : Friday, March 09, 2018 11:39:32 AM
Rank: Elder


Joined: 7/26/2007
Posts: 6,357
winmak wrote:
KulaRaha wrote:
obiero wrote:
KulaRaha wrote:
rate cap, no rate cap, no difference, won't increase access to credit either way.

That's the whole truth. Note is that retail segment was not affected at all but the SME and corporate are driving the repeal agenda. Not even because of the 14% but the 7% floor


tbh rate cap saved banks from huge unsecured bad debt portfolios...imagine Kenyans who had borrowed to buy tvs/empty plots and drinks on weekends trying repay in the current economic environment...



CHicken-egg... part ot 'the current environment' is due to low credit uptake due to stringency of the banks in giving loans (no pricing in risk)


Nope. The current environment is purely created by GoK borrowing and inability to pay suppliers, nothing to do with banks. That is a fallacy.

Banks would have reduced loans whether there was a cap or not...some sooner, others later.
Business opportunities are like buses,there's always another one coming
HaMaina
#2428 Posted : Friday, March 09, 2018 11:57:51 AM
Rank: Member


Joined: 4/23/2014
Posts: 521
End of cheap loans as Uhuru okays scraping of Interest rate by September
Read more at: https://www.standardmedi...k-loans-set-to-end-soon
“You can get in way more trouble with a good idea than a bad idea, because you forget that the good idea has limits.” - Ben Graham
mlennyma
#2429 Posted : Friday, March 09, 2018 12:16:44 PM
Rank: Elder


Joined: 7/21/2010
Posts: 5,872
Location: nairobi
HaMaina wrote:
End of cheap loans as Uhuru okays scraping of Interest rate by September
Read more at: https://www.standardmedi...k-loans-set-to-end-soon

why that far or it was forced unwillingly
"Don't let the fear of losing be greater than the excitement of winning."
Baratang
#2430 Posted : Friday, March 09, 2018 12:35:32 PM
Rank: Member


Joined: 10/6/2009
Posts: 539
mlennyma wrote:
HaMaina wrote:
End of cheap loans as Uhuru okays scraping of Interest rate by September
Read more at: https://www.standardmedi...k-loans-set-to-end-soon

why that far or it was forced unwillingly


I think the International Mater F***ers (IMF) should have consulted the mad pigs in the pigsty (parliament) first before meeting Uhuru.
Right now, most if not all of them are enjoying the cheap loans and adjusting the interest upward and hence the loans repayments may not resonate well with them.

What happens if they throw that interest rate decapping proposal through the window?
mlennyma
#2431 Posted : Friday, March 09, 2018 1:21:50 PM
Rank: Elder


Joined: 7/21/2010
Posts: 5,872
Location: nairobi
Baratang wrote:
mlennyma wrote:
HaMaina wrote:
End of cheap loans as Uhuru okays scraping of Interest rate by September
Read more at: https://www.standardmedi...k-loans-set-to-end-soon

why that far or it was forced unwillingly


I think the International Mater F***ers (IMF) should have consulted the mad pigs in the pigsty (parliament) first before meeting Uhuru.
Right now, most if not all of them are enjoying the cheap loans and adjusting the interest upward and hence the loans repayments may not resonate well with them.

What happens if they throw that interest rate decapping proposal through the window?

The president knows his mps nobody can dare challenge
"Don't let the fear of losing be greater than the excitement of winning."
Spikes
#2432 Posted : Friday, March 09, 2018 1:35:44 PM
Rank: Elder


Joined: 9/20/2015
Posts: 2,470
Location: Mombasa
mlennyma wrote:
Baratang wrote:
mlennyma wrote:
HaMaina wrote:
End of cheap loans as Uhuru okays scraping of Interest rate by September
Read more at: https://www.standardmedi...k-loans-set-to-end-soon

why that far or it was forced unwillingly


I think the International Mater F***ers (IMF) should have consulted the mad pigs in the pigsty (parliament) first before meeting Uhuru.
Right now, most if not all of them are enjoying the cheap loans and adjusting the interest upward and hence the loans repayments may not resonate well with them.

What happens if they throw that interest rate decapping proposal through the window?

The president knows his mps nobody can dare challenge


Yeah...Mr. President knows he's fully supported by sycophants in the house.
Ignorance of the victim is big business for the villain.
Ericsson
#2433 Posted : Friday, March 09, 2018 2:00:14 PM
Rank: Elder


Joined: 12/4/2009
Posts: 5,875
Location: NAIROBI
mlennyma wrote:
HaMaina wrote:
End of cheap loans as Uhuru okays scraping of Interest rate by September
Read more at: https://www.standardmedi...k-loans-set-to-end-soon

why that far or it was forced unwillingly


To give kenyans time to prepare accordingly
aemathenge
#2434 Posted : Monday, March 12, 2018 12:44:53 AM
Rank: Elder


Joined: 10/18/2008
Posts: 2,965
Location: Kerugoya
Spikes wrote:
Yeah...Mr. President knows he's fully supported by sycophants in the house.


On this issue, The Jury is still out.

Copy and Paste extract:

Quote:
Calls by International Monetary Fund to abolish or modify the Interest rate cap are in bad faith and will disadvantage ordinary citizens.

Kiambu Member of parliament Jude Njomo said IMF is using biased data from the Kenya Bankers Association to push their agenda without interests of the public.

Njomo introduced the interest rate cap bill to parliament in 2015 to cap banking lending rates.

The bill signed to law by President Uhuru Kenyatta in September 2016 has seen many banks, policy makers and Key stakeholders in the financial sector call for its repeal claiming that it is hurting the economy.

“IMF can only advice us but not tell us what to do, we are an independent state and the decision to scrap the laws lies with the National Assembly which passed them,” Njomo said.

According to IMF, the controls are undermining effectiveness of monetary policy aimed at ensuring price stability and supporting sustainable economic growth.

He criticised the international policy maker on matters finance for using data from KBA that is not independent instead of carrying out their own research.


Source Link: The Star
Ericsson
#2435 Posted : Monday, March 12, 2018 1:15:49 AM
Rank: Elder


Joined: 12/4/2009
Posts: 5,875
Location: NAIROBI
aemathenge wrote:
Spikes wrote:
Yeah...Mr. President knows he's fully supported by sycophants in the house.


On this issue, The Jury is still out.

Copy and Paste extract:

Quote:
Calls by International Monetary Fund to abolish or modify the Interest rate cap are in bad faith and will disadvantage ordinary citizens.

Kiambu Member of parliament Jude Njomo said IMF is using biased data from the Kenya Bankers Association to push their agenda without interests of the public.

Njomo introduced the interest rate cap bill to parliament in 2015 to cap banking lending rates.

The bill signed to law by President Uhuru Kenyatta in September 2016 has seen many banks, policy makers and Key stakeholders in the financial sector call for its repeal claiming that it is hurting the economy.

“IMF can only advice us but not tell us what to do, we are an independent state and the decision to scrap the laws lies with the National Assembly which passed them,” Njomo said.

According to IMF, the controls are undermining effectiveness of monetary policy aimed at ensuring price stability and supporting sustainable economic growth.

He criticised the international policy maker on matters finance for using data from KBA that is not independent instead of carrying out their own research.


Source Link: The Star


The law was good but the Government and treasury abused it.
Jude Njomo should have studied what NARC did in its first term to bring down the lending rates without passing a law
murchr
#2436 Posted : Friday, March 16, 2018 3:38:10 PM
Rank: Elder


Joined: 2/26/2012
Posts: 13,649
"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
.
snifadog
#2437 Posted : Friday, March 16, 2018 5:40:01 PM
Rank: New-farer


Joined: 6/6/2016
Posts: 90
Location: Nairobi
this IMF is in bed with western DFIs who then disburse these loans through the local banks and expect good returns on them. how they have succeeded in keeping such questionable motives out of this discussion is impressive. the banks were crying doom and gloom when the law was signed.. its earnings season and things are BAU
tafutabiz
#2438 Posted : Monday, March 19, 2018 12:42:06 PM
Rank: New-farer


Joined: 10/3/2014
Posts: 19
snifadog wrote:
this IMF is in bed with western DFIs who then disburse these loans through the local banks and expect good returns on them. how they have succeeded in keeping such questionable motives out of this discussion is impressive. the banks were crying doom and gloom when the law was signed.. its earnings season and things are BAU


You are very right, selfish motives! They take advantage of Africans all the time. IFC (a World Bank private sector funding agency) recently loaned Co-op bank cash to be advanced to SMEs. No one connected this story with the interest rate capping/ IMF debate. We are being forced to give the west good returns. The impact on Interest Rate Capping on Banks is only reduced profits....
Ericsson
#2439 Posted : Monday, March 19, 2018 5:23:56 PM
Rank: Elder


Joined: 12/4/2009
Posts: 5,875
Location: NAIROBI
Kenya central bank cuts main lending rate to 9.5 pct
Kenya’s central bank cut its benchmark lending rate by 50 basis points to 9.5 percent on Monday, the bank’s monetary policy committee said, the first cut since September 2016.

Seven out of 11 analysts polled by Reuters expected the committee to hold the rates. The committee, however, said inflation was well anchored and economic growth was not meeting its potential.

“There was scope for easing its monetary policy stance in order to support economic activity,” it said in a statement.

https://af.reuters.com/a...africaTech/idAFL8N1R14WV
wukan
#2440 Posted : Tuesday, March 20, 2018 12:54:27 PM
Rank: Veteran


Joined: 11/13/2015
Posts: 902
Ericsson wrote:
Kenya central bank cuts main lending rate to 9.5 pct
Kenya’s central bank cut its benchmark lending rate by 50 basis points to 9.5 percent on Monday, the bank’s monetary policy committee said, the first cut since September 2016.

Seven out of 11 analysts polled by Reuters expected the committee to hold the rates. The committee, however, said inflation was well anchored and economic growth was not meeting its potential.

“There was scope for easing its monetary policy stance in order to support economic activity,” it said in a statement.

https://af.reuters.com/a...fricaTech/idAFL8N1R14WV


smile smile 'at the risk of perverse consequences'. They lowered the rate by a similar margin in 2016 with no visible effect. If banks were not lending at 14% will they lend more at 13.5% with IFRS9?

MPC is nowadays more of a credit rationing committee in the ivory towers.
Users browsing this topic
Guest (2)
135 Pages«<120121122123124>»
Forum Jump  
You cannot post new topics in this forum.
You cannot reply to topics in this forum.
You cannot delete your posts in this forum.
You cannot edit your posts in this forum.
You cannot create polls in this forum.
You cannot vote in polls in this forum.

Copyright © 2018 Wazua.co.ke. All Rights Reserved.