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Law Capping interest rates
Rank: Elder Joined: 12/7/2012 Posts: 11,935
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mlennyma wrote:Ericsson wrote:Tomorrow banking stocks will rally;margin of profitability widened Is there a rally mood in the nse?I don't think so but anything is possible in a stock market What if PORK refuses to sign it. Remember ni maneno na IMF. Blood .....  In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Rank: Elder Joined: 6/23/2009 Posts: 14,213 Location: nairobi
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Viva!! ✊ Now, on this semblance of a rate cap review is that at the onset most savings accounts were made into transactional accounts to create spread, lower cost of funds. With this 0-14% band is still to watch the yield curve especially 91, 182, 364 day T-bills. Whether it will translate to Real economy private sector lending, maybe with 91 day T-bills at 4%, is a wait and see. Otherwise, it will just lower the cost of funding bloat & graft (GoK).
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Rank: Elder Joined: 6/23/2009 Posts: 14,213 Location: nairobi
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Cde Monomotapa wrote:Viva!! ✊ Now, on this semblance of a rate cap review is that at the onset most savings accounts were made into transactional accounts to create spread, lower cost of funds. With this 0-14% band is still to watch the yield curve especially 91, 182, 364 day T-bills. Whether it will translate to Real economy private sector lending, maybe with 91 day T-bills at 4%, is a wait and see. Otherwise, it will just lower the cost of funding bloat & graft (GoK). True. Plus now that the deposits will be on chase, expect smaller banks to fall by the way side via high interest expense
KQ ABP 4.26
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Rank: Elder Joined: 7/26/2007 Posts: 6,514
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Wakanyugi wrote:FRM2011 wrote:FRM2011 wrote:FRM2011 wrote:
Finance bill finally on the floor of the house. There are numerous amendments on the bill. Lets see how this goes.
Junet Mohamed passionately pushing for an extension of the VAT deadline to 2020. This would put on hold plans to charge VAT on petroleum products w.e.f 1st Sept 2018. PS: The speaker has ruled that the rate cap amendment cannot be discussed until treasury gives its input. Update from parliament; 1. MPs have debated and voted to retain rate capping on loans but removed the rate on savings. Worth noting the speaker had ruled the amendment cannot be discussed. 2. MPs have rejected the treasury's proposal to introduce a mandatory contribution to the national housing fund. 3. MPs have rejected the VAT on petroleum and extended the deadline to 1st Sept 2020. Fair enough. Kularaha predicted exactly this fudge on Caps. Let's see if Untie IMF will be satisfied. What boggles my mind is MP's voting down easy cash grabs like the robing hood tax and the earlier plan to create a super bracket for PAYE. Like for sin taxes, no one cries when the rich get hit. IMF also wanted VAT on fuel...they didn't get it. But with cost of funds dropping, expect more supernormal bank profits while you still wont get loans because GoK is paying the same rate as you and is perceived as "lower" risk than you. plus ça change..... BTW, what happened with robbin(g) hood? Business opportunities are like buses,there's always another one coming
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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obiero wrote:Cde Monomotapa wrote:Viva!! ✊ Now, on this semblance of a rate cap review is that at the onset most savings accounts were made into transactional accounts to create spread, lower cost of funds. With this 0-14% band is still to watch the yield curve especially 91, 182, 364 day T-bills. Whether it will translate to Real economy private sector lending, maybe with 91 day T-bills at 4%, is a wait and see. Otherwise, it will just lower the cost of funding bloat & graft (GoK). True. Plus now that the deposits will be on chase, expect smaller banks to fall by the way side via high interest expense Contrarily, sector liqudity is at a record high circa 50% (prudential mininimum 20%). Thus, and with lending capped at 14%, liquidity will be rebalanced and savers will deposit with smaller, agile banks (lower overhead expenses; fintech) offering higher rates on savings than larger banks.
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Rank: Elder Joined: 7/26/2007 Posts: 6,514
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Cde Monomotapa wrote:obiero wrote:Cde Monomotapa wrote:Viva!! ✊ Now, on this semblance of a rate cap review is that at the onset most savings accounts were made into transactional accounts to create spread, lower cost of funds. With this 0-14% band is still to watch the yield curve especially 91, 182, 364 day T-bills. Whether it will translate to Real economy private sector lending, maybe with 91 day T-bills at 4%, is a wait and see. Otherwise, it will just lower the cost of funding bloat & graft (GoK). True. Plus now that the deposits will be on chase, expect smaller banks to fall by the way side via high interest expense Contrarily, sector liqudity is at a record high circa 50% (prudential mininimum 20%). Thus, and with lending capped at 14%, liquidity will be rebalanced and savers will deposit with smaller, agile banks (lower overhead expenses; fintech) offering higher rates on savings than larger banks. In Kenya, agile = risky. Lets see if folks still have appetite after the Chase/Imperial dramas. I doubt. Business opportunities are like buses,there's always another one coming
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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KulaRaha wrote:Cde Monomotapa wrote:obiero wrote:Cde Monomotapa wrote:Viva!! ✊ Now, on this semblance of a rate cap review is that at the onset most savings accounts were made into transactional accounts to create spread, lower cost of funds. With this 0-14% band is still to watch the yield curve especially 91, 182, 364 day T-bills. Whether it will translate to Real economy private sector lending, maybe with 91 day T-bills at 4%, is a wait and see. Otherwise, it will just lower the cost of funding bloat & graft (GoK). True. Plus now that the deposits will be on chase, expect smaller banks to fall by the way side via high interest expense Contrarily, sector liqudity is at a record high circa 50% (prudential mininimum 20%). Thus, and with lending capped at 14%, liquidity will be rebalanced and savers will deposit with smaller, agile banks (lower overhead expenses; fintech) offering higher rates on savings than larger banks. In Kenya, agile = risky. Lets see if folks still have appetite after the Chase/Imperial dramas. I doubt. We're talking listed banks here. DTB, NIC.
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Rank: Veteran Joined: 9/18/2014 Posts: 1,127
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FRM2011 wrote:
The house also rejected the 0.05% tax on transfers over Kes.500,000 (robinhood tax).
What does this portend for the budgeting process in future ??
Scrapping the robinhood tax is perhaps the best decision/contribution the house has made in a long time. I don't think they were able to see the whole picture but their self preservation helped KE avert a self inflicted injury. The main purpose of the stock market is to make fools of as many people as possible.
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Law Capping interest rates
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