CBK corrects DP Gachagua on the remarks he made on the media.
Central bank of Kenya, CBK corrects DP Gachagua on the comments he made indicating that state capture, had paralyzed their operations especially in foreign exchange.
The central bank of Kenya maintained that it has no control over foreign exchange in commercial banks; It only controls forex exchange for the national government and its operations.
In his statement, the Deputy president blamed influential political leaders who have taken control over banks, resulting to forcing oil importers to be over charged while buying oil due to high foreign exchange rates.
DP Rigathi said,”Why there is forex exchange problem is because of state capture. There was a lot of interest in banks where very senior government people own certain banks and they got involved in this forex business. Central Bank so no longer in charge.”
CBK refuted the claims stating that oil importers obtain their requisite foreign exchange from commercial banks and not CBK.
CBK stated,” First, following the complete liberalization of the foreign exchange market in the 1990’s, all foreign exchange for private transactions is obtained from commercial banks.”
“CBK does not supply foreign exchange for transactions other than for the National Government (i.e., government’s own imports or debt service payments) or CBK’s operations. Oil importers, therefore, obtain their requisite foreign exchange from the commercial banks and not CBK,” CBK added
The central bank of Kenya further stated that its operations are regulated by the CBK Act section 26 and its cover in the country is adequate.
CBK stated,”The Central Bank of Kenya Act (Section 26) requires that CBK “at all times use its best endeavours to maintain a reserve of external assets at an aggregate amount of not less than the value of four months’ imports as recorded and averaged for the last three preceding years.” This stood at 4.64 months of imports as of September 26, 2022.”