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{
    "id": 267438,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/267438/?format=api",
    "text_counter": 399,
    "type": "speech",
    "speaker_name": "Mr. Keynan",
    "speaker_title": "",
    "speaker": {
        "id": 41,
        "legal_name": "Adan Wehliye Keynan",
        "slug": "adan-keynan"
    },
    "content": "We should look at the role that the Central Bank of Kenya (CBK), as the regulator, ought to have played. One of the things that you realise is that there was a policy of inaction by the CBK. This contributed to the creation of opportunities for arbitrary malpractice by banks. This also contributed to failure to detect and arrest the speculative activities of some of the key financial institutions. Mr. Temporary Deputy Speaker, Sir, this also brought about some sort of communication breakdown between the key financial institutions and the regulator. There was also ineffectiveness of the Monetary Policy Committee, which I will discuss later. Again, there was inadequate policy response. The CBK just decided to sit and watch. In the process, the CBK issued over 20 circulars within a span of two months, but this did not in any way contribute to the stabilisation of the shilling. Again, the CBK did not react in good time by putting measures in place in order to stabilize the shilling. The CBK kept the discount window rate below the inter-bank exchange rate and Treasury Bills. This encouraged commercial banks to bypass inter-bank transactions and enjoy the lower discount window rate. During this period, a number of banks engaged in arbitrary malpractice. In the year 2010, all the banks, cumulatively, borrowed from the discount window about Kshs11 billion."
}