FILE PHOTO | NMG
Banks have restructured loans worth Sh679.6 billion or 23.4 percent of the total loan book by end of May due to the coronavirus disease economic hardships that have hurt the borrowers’ ability to repay.
The Central Bank of Kenya (CBK) allowed lenders to offer relief to distressed customers in mid-March after the first positive case of Covid-19 in the country was reported.
“Total loans that have been restructured are worth Sh679.6 billion and accounted for 23.4 percent of the total banking sector loan book of Sh2.9 trillion.
The government has halved its projected economic growth for this year to three percent from an initial forecast of six percent
Apart from allowing lenders to offer relief to distressed borrowers, the CBK has also cut lending rates and lowered the ratio of cash that commercial banks are required to hold.
Policymakers, who lowered the key rate by a hefty total of 125 basis points in March and April after Kenya’s first case of the Covid-19 disease was confirmed, left it unchanged at 7.0 percent.
