The Treasury has drawn Sh5 billion from the Central Bank of Kenya’s cash reserves, barely five months after receiving a dividend cheque from the banking sector regulator.
CBK announced on Wednesday that it had credited the National Treasury’s account with Sh5 billion out of its surplus funds, marking its latest contribution to the government’s coffers.
The lender of last resort has now given the government a total of Sh14.8 billion since last year including a Sh2.5 billion dividend on its results for the year ended June 2020 and Sh7.3 billion gained from the cancellation of the old Sh1,000 notes.
“The Central Bank of Kenya announces that on February 17, 2021, it transferred to the government Consolidated Fund Sh5 billion as an exceptional distribution from CBK’s General Reserve Fund in the current financial year 2020/21,” the regulator said in a statement today.
“The CBK board authorised the transfer … noting the very exceptional circumstances caused by an unprecedented global pandemic that have put a strain on government’s resources, and having weighed the various factors as stipulated by the law.”
Central bank says it will remain well-funded to deliver on its mandate of financial and macroeconomic stability.
Treasury Secretary Ukur Yatani has disclosed that ordinary revenue for the six months through December fell short of the Sh907.7 billion target by Sh107.6 billion.
The shortfall is attributed to the economic contraction caused by Covid-19 shutdowns, besides tax reliefs that benefitted workers, consumers and businesses for nine months starting April last year.
CBK’s latest payment adds to the Sh7.3 billion that the institution gave to the government in March last year.