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Kenya’s Central Bank Proposes New Rules to Strengthen Bank Liquidity and Stability

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  • Draft guidelines require banks to hold more liquid assets to mitigate risks of mass withdrawals
  • Proposals aim to align Kenya’s banking sector with global Basel III standards

Nairobi, Kenya – The Central Bank of Kenya (CBK) has released draft guidelines requiring banks to bolster their liquidity coverage ratio (LCR) by holding a larger stock of unencumbered high-quality liquid assets (HQLA), such as government securities. The move seeks to fortify the banking sector’s resilience against financial shocks, including potential bank runs.

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