Kenya’s Central bank suspends issuance of new bank licences

central bank of kenya

Kenya’s central bank has stopped the licensing of new commercial banks with immediate effect.

However, the moratorium does not apply to cases relating to resolution, amalgamation and acquisition of banks. No reason for the sudden freeze of bank licensing has been given by the regulator in a published notice announcing the directive.

Last month, the central bank placed privately owned Imperial Bank under receivership after Imperial’s board alerted it to malpractices at the lender.

The central bank said later it had unearthed fraud within Imperial Bank, but that the bank was still viable and shareholders were considering a proposal to inject capital. Last week, it expressed concern that the shareholders of Imperial Bank were not acting quickly enough to spell out a plan to revive the mid-sized lender.