Bankers laud CBK for issuing Foreign Exchange Code

The Kenya Bankers Association has applauded the Central Bank of Kenya for issuing a comprehensive Kenya Foreign Exchange Code (FX Code).

In a statement on Monday, the Association said the move will help in steering the market to strongly align with global best practices and stabilise the foreign exchange market.

“The implementation of this code is expected to restore trust and enhance the functioning of the foreign exchange market, support the country’s flexible exchange rate regime in keeping with its true price discovery principle, and deliver other attendant benefits to the overall economy,” the statement reads.

KBA also affirmed its commitment to standing by the introduced Foreign Exchange Code.

“The industry will continue its regular engagements with the Central Bank of Kenya and other market players to ensure that the foreign exchange market is functioning and promoting best practices to the benefit of our customers and economy at large,” the statement reads.

The FX Code draws from the Global Foreign Exchange Code and is customised to fit into the Kenyan context.

It reinforces six principles ranging from ethics and professionalism, governance; execution of transactions; risk management and compliance; information sharing; to confirmation and settlement processes.

The Central Bank which issued the code on March 22 said it has been developed in a response to weaknesses and risks that have emerged as a result of the considerable and positive transformation Kenya's financial landscape has experienced over the years.

“The FX Code is intended to promote a robust, fair, liquid, open, and appropriately transparent market in which a diverse set of Market Participants, supported by resilient infrastructure," CBK’s statement reads.

"Can confidently and effectively transact at competitive prices that reflect available market information in a manner that conforms to accepted global standards of behavior and best practices.”