Central Bank of Kenya (CBK) has transferred Sh5 billion to the National Treasury as an “exceptional” payment to the government.
In a press statement, CBK said it credited the money into the government’s Consolidated Fund on February 17 amid the difficult financial times caused by Covid-19.
The rushed payment, it said, was an exceptional distribution from its General Reserve Fund.
“The CBK board authorised the transfer during its discussion of the unaudited financial statements for the 2020-21 financial year as at December 31, 2020, 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,” read the statement.
CBK said the board considered the apex bank’s financial needs in what is aimed at ensuring the financial sector regulator is well-resourced to deliver on its mandate in the increasingly uncertain economic environment.
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According to the Central Bank of Kenya Act, CBK is supposed to transfer at least 10 per cent of its annual profits to the Ministry of Finance.
The decision is made by the CBK board in collaboration with the National Treasury Cabinet Secretary.
The transfer is done after allowing for CBK’s operational expenses and after provision has been made for bad and doubtful debts, depreciation in assets, contributions to staff benefit funds, and other contingencies and accounting provisions as the financial regulator deems appropriate.
Last March, CBK transferred Sh7.4 billion that it had saved from the demonetisation process that withdrew the old Sh1,000 notes from circulation.