Central Bank of Kenya Penalizes 33 Commercial Banks Over Credit Pricing Models

The Central Bank of Kenya revealed that it levied penalties against 33 commercial banks following targeted inspections into the implementation of the Risk-Based Credit Pricing Model, which was rolled out in 2019. Administrative action was also taken against two other institutions, while only three were found to be fully compliant. The regulator noted that its monetary-policy decisions were not being transmitted uniformly or effectively into commercial-bank lending rates.

The findings indicate serious deficiencies across the majority of the commercial banking sector regarding regulatory compliance. The regulator chose to disclose the number of penalized institutions but did not reveal which specific banks were fined or the amount of the penalties.

The Central Bank of Kenya is a mandated national institution that implements monetary policy and manages financial stability under the jurisdiction of the Kenyan state.