Sh25bn T-bill fire sale raises liquidity queries

Investors sold back Treasury bills worth nearly Sh25 billion to the Central Bank of Kenya (CBK) just over a week ago, indicating those facing low liquidity were unable to borrow from the market hence the move to liquidate income generating securities.

Small banks were the likeliest sellers of their securities to plug a liquidity shortage, which has been an underlying problem for them in the past few months as bigger lenders become more wary of lending to them on overnight basis following the collapse of Dubai, Imperial and Chase banks.