50 years of central banking in Kenya : regional and global perspectives / Edited by Patrick Njoroge, Victor Murinde.

Format:

Book

Contributor:

Njoroge, Patrick, editor.

Murinde, Victor, editor.

Series:

Oxford scholarship online.

Oxford scholarship online

Language:

English

Subjects (All):

Banks and banking, Central--Kenya--History.

Banks and banking, Central.

Central Bank of Kenya--History.

Central Bank of Kenya.

Kenya.

Genre:

History.

Physical Description:

1 online resource (512 pages) : illustrations (black and white, and colour).

Edition:

First edition.

Place of Publication:

Oxford, England : Oxford University Press, [2021]

Summary:

Documenting important milestones in the epic journey traversed by the Central Bank of Kenya (CBK) over the last 50 years, this volume puts into perspective the evolution of central banking globally and within the East African region, and contemplates future prospects and challenges.

Contents:

Cover

50 Years of Central Banking in Kenya: Regional and Global Perspectives

Copyright

Acknowledgements

Contents

List of Figures

List of Tables

Notes on Contributors

Editors

Contributors

Chapter 1: Introduction

1.1 Background

1.2 The Chapters in Outline

1.3 More than a Golden Jubilee

Part I: Central Banking: Global and Regional Perspectives

Chapter 2: Monetary Policy and the Future of Central Banking: Implications for Africa

2.1 Introduction

2.2 Evolution of Central Banking

2.3 African Central Banking in Perspective

2.4 Challenges Facing Africa

2.5 The Way Forward

2.6 Conclusion

Chapter 3: Reflections on Central Banking

3.1 Introduction

3.2 The Epic Journey: Global and Local Milestones

3.2.1 Initial Conditions: The Swedish Riksbank (1668) and Bank of England (1694)

3.2.2 The Transition: The Walter Bagehot Milestone and the US Federal Reserve Milestone

3.2.3 Modern Central Banking

3.2.4 From the 1919 Milestone to the 1966 Milestone in Kenya

3.3 Observations on Some Unresolved Issues

3.3.1 Macroeconomic Policy Modelling

3.3.2 Governance: Central Bank Independence and Other Governance Reforms

3.3.3 Exchange Rate Regime and Natural Resources

3.3.4 Bank Regulation: Still at the Crossroads?

3.3.5 Globalization (Cross-border) and Convergence of Banking Systems

3.4 Futurology of Central Banking

3.4.1 The Future of Bank Regulation Cannot Ignore Peer Monitoring and Market Discipline

3.4.2 The Mandate of a Central Bank

3.4.3 Governance through Ownership: Should Central Banks Be Privatized?

3.4.4 Some Emerging Issues

3.5 Conclusion and Some Key Take-away Highlights

References

Chapter 4: Central Bank Independence: What Are the Key Issues?

4.1 Introduction

4.2 Central Bank Independence and Central Bank Conservatism.

4.2.1 Central Bank Independence

4.2.2 Key Measures of Central Bank Independence

4.2.3 Evidence on Central Bank Independence

4.2.4 Key Measures of Central Bank Conservatism

4.3 Benefits of Central Bank Independence

4.4 The Governance of Central Banks

4.5 Observations about Central Bank Independence in Kenya

4.6 Conclusion

Chapter 5: Evolution of Central Banking: Some Observations

5.1 Introduction

5.2 Snapshot of Economic Convergence

5.3 The Evolving Role of Central Banks

5.4 General Lessons from the Euro Area Crisis

5.5 Blueprint for Designing the East African Monetary Union

5.6 Final Remarks

Chapter 6: Financial Stability and Bank Supervision in the Twenty-First Century

6.1 Introduction

6.2 Financial Stability

6.3 Effective Bank Supervision

6.4 Conclusion

Chapter 7: Financial Innovation and Financial Inclusion: Insights from a Practitioner

7.1 Introduction

7.2 The M-PESA Journey: A Triumph

7.3 M-PESA Partnerships and Successes

7.4 How Does M-PESA Fit into the Regulatory Environment?

7.5 Is M-PESA a Banking Service?

7.6 M-PESA-Powered Financial Inclusion

7.6.1 The Pilot Project for Financial Inclusion

7.6.2 KPMG True Value Case Study

7.6.3 Financial Inclusion and Kenya's Vision 2030

7.6.4 Savings and Credit in Mobile Money

7.7 Mobile Money as a Tool for Financial Deepening

7.8 Conclusion: The Future of Mobile Money

Chapter 8: Do Central Banks Have a Role in Financial Inclusion?

8.1 Introduction

8.2 What Is Financial Inclusion All About?

8.3 The Short-Term Threat to Stability

8.4 The Longer-Term Perspective: Synergies

8.5 Beyond Stability: Broader Economic Policy

8.6 Implications

8.7 A Case Study of Central Bank Engagement: Kenya

8.8 Conclusion

References.

Chapter 9: Central Banking and Financial Inclusion: Some Key Issues

9.1 Introduction

9.2 Why Does Financial Inclusion Matter for Central Banking?

9.3 How Much Financial Inclusion Have We Achieved in Africa?

9.4 What Needs to be Done to Support Further Financial Inclusion?

9.5 What Should Be the Role of Central Banks?

9.6 Conclusion

Chapter 10: Mobile Money

10.1 Introduction

10.2 How Mobile Money Works

10.2.1 Mobile Money as a Distinct Product

10.2.2 Regulation of Mobile Money

10.3 The Success (or Lack Thereof) of Mobile Money

10.4 Impacts of Basic Mobile Money

10.5 Conclusion: Is Mobile Money the Payment Infrastructure of the Future?

Chapter 11: East African Monetary Union: What Lies Ahead?

11.1 Introduction

11.2 Strengthening Economic Integration within the EAC

11.3 Ensuring Fiscal Sustainability

11.3.1 The Debt Ceiling

11.3.2 Ceiling on the Fiscal Deficit Including Grants

11.3.3 Fiscal Deficit Excluding Grants

11.3.4 Tax to GDP Ceiling

11.3.5 Fiscal Management in Oil Producing Economies

11.4 Aligning Exchange Rates Prior to the Introduction of the Single Currency

11.5 The Challenge of Stabilization in the Face of Asymmetric Macroeconomic Shocks

11.6 Concluding Remarks

Part II: The Central Bank of Kenya

Chapter 12: The Early Days of the Central Bank of Kenya

12.1 Introduction

12.2 Decision to Establish a Central Bank in Kenya and Issue Kenyan Currency

12.2.1 First News about the Decision

12.2.2 Dr Leon Baranski

12.2.3 The Legislation

12.3 Discussions Around the Name of the New Institution

12.3.1 The English Name

12.3.2 The Kiswahili Name

12.3.3 Which Name Should Take Precedence?

12.3.4 Which Name to be Used on Kenyan Currency?

12.4 Independence of Central Bank and Relations with Treasury.

12.4.1 Initial Discussions

12.4.2 Powers to Appoint Governor, Deputy Governor and Board of Directors

12.4.3 Relations between the Central Bank and the Treasury

12.4.4 Dr Baranski Threatens to Resign

12.4.5 Concessions by the Treasury

12.4.6 Concessions by Dr Baranski

12.4.7 Other Matters Agreed between the Treasury and the IMF Delegation

12.5 Capital and Ownership of the Bank

12.6 Government Borrowings from the Bank

12.6.1 The Flow of Funds

12.6.2 First Direct Advance from the Central Bank to the Treasury

12.6.3 Short-Term Crop Financing

12.7 Rudimentary Monetary Policy Pre-Central Bank

12.7.1 IMF Delegation

12.7.2 Interest Rates

12.7.3 Increase in Bank Deposits and Credit Base

12.7.4 Protect Financial Institutions and Depositors

12.7.5 Protection of Building Societies and Their Depositors

12.7.6 Use of Exchange Control to Protect Foreign Exchange and Indirectly Bank Deposits

12.8 Monetary Policy Instruments in the Central Bank Act

12.8.1 Instruments of Monetary Policy

12.8.2 Par Value

12.9 Foreign Exchange Reserves and its Composition

12.9.1 Quantum of Foreign Exchange Reserves

12.9.2 Composition of Foreign Exchange Reserves

12.10 Location of Central Bank

12.11 Matters Discussed in Context of Kenya Currency

12.11.1 Withdrawals of 'Lake Issues' or 'Lake Victoria' Notes

12.11.2 Share of Surplus of the EACB

12.11.3 Coins

12.11.4 Holes in Some Coins

12.11.5 Currency Notes or Coins?

12.11.6 Limits on Settlement of Debts using Coins

12.11.7 Respect for Currency

12.11.8 First Drafts of Currency Notes

12.11.9 Signature on Currency Notes

12.11.10 Kenya or Ethiopian Lion

12.11.11 Transportation of Currency Notes

12.12 Revival of Nairobi Stock Exchange and Government Bonds' Secondary Market

12.12.1 Steps Taken to Create Active Market for Bonds.

12.12.2 Use of Exchange Control to Promote Bonds and Finance Development Expenditure

12.12.3 Promoting Confidence and the Market for Kenya Sterling Bonds in London

12.13 My Working Relationship with Dr Baranski and Decisions Taken by Us

12.13.1 Before and After the Establishment of the Central Bank

12.13.2 Dr Baranski's Offer to Me to Join Central Bank of Kenya as Bank Secretary

12.13.3 Bank General Manager

12.13.4 Information Received by Central Bank from Commercial Banks

12.13.5 Transfer of Government Accounts

12.13.6 National Social Security Fund

12.13.7 Use of NSSF Fund to Abolish Fee for Medical Treatment

12.13.8 International Monetary Fund

12.13.9 IMF Article IV Consultations

12.13.10 Tea Loan for Small-Scale Kenya Farmers

12.13.11 Dr Baranski Appointed First Governor of the Central Bank

12.13.12 Requirement of Minimum Qualifications

12.13.13 Exchange Control

12.13.14 Enactment of New Banking Act: Powers to Licence Commercial Banks and Investments of Assigned Capital

12.13.15 Dr Baranski Not Happy at Initial Quantum of Foreign Exchange

12.13.16 Transfer of Sterling Funds Held by Provident and Pensions Funds

12.13.17 Transfer of Commercial Banks' Foreign Exchange Reserves

12.13.18 Transfer of Life Insurance Companies Funds

12.13.19 Transfer of Supplementary Funds Assets

12.13.20 Transfer of Sterling Assets of Post Office Savings Bank to Central Bank of Kenya

12.13.21 Mr Duncan Ndegwa Appointed Governor

12.13.22 Veto

12.13.23 Post Establishment of Central Bank of Kenya

12.14 Establishment and Strengthening of the Commercial Banking Sector

12.14.1 African Development Bank (1963)

12.14.2 Commercial Bank of Africa (1967)

12.14.3 Cooperative Bank of Kenya and Extension of Credit Base for Local Farmers (1968).

12.14.4 National Bank of Kenya and Extension of Credit Base for Local Entrepreneurs (1968).

Notes:

This edition also issued in print: 2021.

Includes bibliographical references and index.

Description based on print version record.

ISBN:

0-19-188650-5

0-19-259278-5

0-19-259279-3

OCLC:

1243552110