Alongside high profits at the top tier, regulators are tightening the screws on under-capitalised lenders, with about 11 commercial banks reported to be at risk of licence revocation if they fail to plug a combined KSh 15 billion core capital hole by December 2025. The tougher stance follows reforms that lifted the minimum core capital requirement for operating banks to KSh 3 billion, more than tripling the previous threshold and forcing weaker institutions to seek mergers, strategic investors or shareholder cash calls.
Thank you for reading this post, don't forget to subscribe!At the same time, recent stress-test commentary suggests Kenya’s six largest banks would face a sizeable capital shortfall in a severe shock scenario where their three biggest borrowers default, keeping concentration risk firmly on CBK’s radar. As December approaches, the capital race at the bottom and concentration scrutiny at the top converge into a single narrative: regulators want a smaller number of stronger, better-capitalised banks, and institutions that fail to adapt could be forced into consolidation or exit.
