Kenya to Progressively Raise Bank Capital Requirements 10-Fold to KES 10 Billion

Jun 13, 2024, 01:46 PM

The Central Bank of Kenya plans to progressively increase the minimum core capital requirements for banks from the current KES 1 billion to KES 10 billion. This move, announced by Kenya's Finance Minister and Treasury CS, aims to strengthen the resilience of the banking sector and enhance its capacity to finance large-scale projects. The increase in capital requirements, described as a 10-fold rise by Prof Njuguna Ndung'u, is expected to lead to consolidation within the banking sector, as only 15 of the 39 registered banks in Kenya currently meet the new threshold based on December 2022 figures. Banks that do not meet the new requirements will need to raise capital, merge, or potentially close.