RBM releases MK12 billion for Commercial Banks

The Reserve Bank of #Malawi (RBM) has disbursed K12 billion to commercial banks to give loans to their customers to cushion the effects of #CoronaVirus.

The development came barely hours after President Professor Arthur Peter Mutharika informed Malawians that the country has registered three cases of COVID-19 in the capital Lilongwe.

According to the statement released on Thursday signed by RBM governor Dalitso Kabambe, a Monetary Policy Committee resolved to cut the Liquidity Reserve Requirement (LRR) on domestic deposits by 125 basis points to 3.75 percent from 5.0 percent.

“This reduction will immediately release primary liquidity of about K12 billion uniformly across the banking system in proportion to liabilities of the banks,” he said.

He added that the committee also resolved to reduce the Lombard Rate ( interest rate charged by central banks when providing short-term loans to commercial banks) by 50 percent to 0.2 percentage points above the Policy Rate to reduce the cost of accessing funds from the Central Bank.

Below is the statement;