BLANTYRE, Malawi, April 3 (Xinhua) -- As Malawi registered its first three COVID-19 cases, the Reserve Bank of Malawi (RBM) has decided to cut the Liquidity Reserve Requirement (LRR) on domestic deposits by 1.25 percentage points to 3.75 percent.
According to a press statement released on Thursday by the RBM's chairperson Dalitso Kabambe, the reduction will immediately release primary liquidity of about 16 million U.S. dollars across the local banking systems which will see a reduction in the cost of accessing funds from the central bank and this will enable commercial banks to pass on the benefits to its borrowers.
This development has come to ease banking system liquidity constraints and incentivize commercial banks to adequately support the sectors that are hit by COVID-19 pandemic,said Kabambe.
RBM spokesperson Mbane Ngwira told a local newspaper early this week that the central bank is aware of the threats of COVID-19 on national economy and that the bank has formed a special team which has been formed to assess the possible threats on each category of the economy.
Malawi registered its first COVID-19 case on Tuesday in Lilongwe. The president has advised Malawians to continue protecting themselves from the virus and not to panic during this time.
