Forex margins raise concerns amid shortage claims
The wide forex margins being experienced witnessed have sparked online debate as the market hopes for a balance amid a biting forex shortage.
Data from several banks shows that forex spreads among banks have widened from lows of Sh7 per dollar to over Sh15 per dollar as the lenders cash in on the frenzy.
Last week for instance, NCBA Bank was buying dollars at Sh114 and selling for Sh125 while National Bank was buying at Sh111 and selling at Sh126. A spot check on Tuesday showed that KCB Bank was buying dollars at 111.15 and selling at 129.1 while Stanbic Bank was buying at 114.25 and selling at 125.45. NCBA Bank was buying the foreign currency at 114.25 while selling at 125.85.
“Why is CBK allowing banks to earn such huge forex spreads. Once you allow this kind of profiteering the value of the shilling will be at the mercy of speculators. It will no longer be about fundamentals,” said Ephraim Njenga, a finance professional.