Interest on loans and advances, fees and commissions and government securities were the major sources of income accounting for 58.5 percent, 19.4 percent and 15.1 percent of total income respectively while interest on deposits, staff costs and other expenses were the main components of expenses, accounting for 32.7 percent, 28.4 percent and 24.3 percent respectively.
Net assets grew by 5.3 percent from Sh2.82 trillion in
Deposits were the main source of funding for the banking sector, accounting for 72.3 percent of total funding liabilities with the deposit base growing by 5.4 percent from Sh2.04 trillion in
The number of bank deposit accounts increased from 23.8 million in
"The banking sector registered improved capital levels in
CBK attributed the decline in capital adequacy ratios to higher increase in total risk weighted assets than the increase in capital base during the period under review.
The value of gross non-performing loans (NPLs) increased by 6.9 percent from Sh95.1 billion in
During the period under review, eight out of 11 sectors registered increase in NPLs owing to the spill-over effects of high lending interest rates and challenges in the business environment.
The number of banking transactions undertaken through agents increased from 11.8 million registered in the quarter ending
"The adoption of agency banking model is expected to facilitate commercial banks to reach the under-banked and unbanked Kenyan public," CBK stated.
CBK says the banking sector is expected to sustain its growth mainly supported by the branch expansion, regional integration initiatives, advances in information and communications technology and the adoption of the devolved governance system in
The bankers set 9.13 percent as the new Kenya Banks Reference Rate aimed at bringing down the cost of borrowing.
The industry has also implemented the adoption of the Annual Percentage Rate (APR) pricing mechanism for loans where banks will now begin disclosing to loan applicants the components that makeup the total cost of credit as a percentage known as Annual Percentage Rate.
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