The Central Bank of Kenya (CBK) has lifted the temporary suspension that the government had put in place on the licensing of new banks in the country. In a press statement released on Wednesday, CBK confirmed that the moratorium that had been in place since November 17, 2015, will be lifted effective July 1 this year. The temporary suspension was imposed against a backdrop of governance, management, and operational challenges in the banking sector.
Further, it was intended to provide space for the strengthening of the Kenyan banking sector, according to CBK. Central Bank of Kenya Governor Kamau appearing before the National Assembly Finance and National Planning Committee on Tuesday, March 25, 2025.
Photo Parliament of Kenya According to CBK, the lifting of the suspension has been informed by the strides that have been made in strengthening the legal and regulatory framework guiding the operations of the banking sector. Additionally, it indicated that the developments have been informed by the growing number of mergers of banks and the influx of foreign investors into the sector. ''Since then, significant strides have been made in strengthening the legal and regulatory framework for Kenya's banking sector.
Notably, there have been several mergers and acquisitions by existing players and the entry of new domestic and foreign strategic investors into the sector,'' CBK stated. ''The recent increase in the Business Laws (Amendment) Act, 2024, of the minimum core capital requirements for commercial banks to Ksh10 billion will further reinforce the strengthening of the banking sector,'' it added. Following the lifting of the moratorium, new entrants to the Kenyan banking sector will be required to demonstrate that they can meet the enhanced minimum capital requirements of Ksh10 billion.
