Tuesday, September 28, 2010

BOB defends its monetary policy

Bank of Botswana (BoB) leapt to the defence of its Monetary Policy while at the same time conceding that local commercial banks are making “abnormal profits” that raise concern through lending interest rates.

The move by the central bank follows an article carried by Sunday Standard a fortnight ago that stated that local commercial banks were making a killing out of Bank of Botswana Certificates (Bobcs) and the lending interest rates.

The Sunday Standard article was based on Professor Roman Grynberg’s research, "The Cost of Botswana’s Monetary Policy" that showed that, under the current tools used by Bank of Botswana, commercial banks are making huge profits from unbelievable interest rates while at the same time getting huge returns from Bobcs at no risk. Click here for more.

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