Kenyan commercial banks have so far restructured 1.63-trillion Kenyan shillings ($14.81bn) in loans as borrowers seek more time to recover from the covid pandemic.
The loan restructuring programme began after forbearance provided by the Kenyan central bank last year.
The amount so far restructured is equivalent to 54.2% of the total outstanding of 3-trillion shillings (more than $28bn) for the industry, assisting borrowers hit by the impact of the pandemic.
On Wednesday, Kenya’s central bank held its benchmark lending rate at 7%, after a meeting of the monetary policy committee.
The bank said measures it had put in place since March had helped mitigate the effects of Covid-19 on the economy.
Like other central banks worldwide, Kenya’s central bank introduced a range of easing measures at the start of the coronavirus pandemic in March and April 2020 to try to contain damage to the economy caused by the crisis.
It is the sixth straight time the bank has held its rate.
Since March, the bank has cut the benchmark lending rate by a total of 125 basis points, slashed cash reserve requirements for commercial banks and allowed them to restructure distressed loans.
Similar to other economies worldwide, Kenya’s tourism, education, transport and other key sectors have been hit hard by the Covid-19 pandemic.
The sectors have started to recover after the government lifted some restrictions it put in place to contain the coronavirus’s spread, but they are yet to return to pre-pandemic levels.
The government forecasts the economy to grow 6.4% in 2021 from an estimated 0.6% 2020.
The central bank said it forecast the current account deficit to be 5.1% of GDP in 2021, from 4.8% in 2020. Its next meeting will be in March.
