This archive report was first published on 29 November 2019.
On November 29, 2019, S&P Global Ratings gave Kenya's banking sector a B+ rating in its latest Banking Industry Country Risk Assessment.
The rating agency noted a stable industry risk trend, driven by continued consolidation among small and midsize banks, as well as the regulator's support for market-led solutions.
Kenya's banking sector is grouped in the same category as banks in Tunisia, Turkey, Uzbekistan, Vietnam, Cambodia, and Nigeria.
According to S&P, the economic risk trend in Kenya is stable, reflecting strong headline GDP growth and an acceleration of lending following the lifting of the cap on lending rates.
However, the agency also highlighted potential negatives, including low GDP per capita wealth dynamics, infrastructure shortfalls, and persistent asset-quality trends.
Meanwhile, a comparison report by Moody's found that Kenya's three largest rated banks have stronger cost-to-income ratios than their Nigerian counterparts.
Moody's analyst Peter Mushangwe attributed this to higher margins, stronger cost-to-income, and lower loan-loss provisioning costs among Kenyan banks.
