Kenya’s Central Bank Seeks Plans to Reach 5 Billion Shillings Despite Extension to 2032
Key Facts
The Central Bank of Kenya wants some commercial banks to explain how they will reach the minimum core capital threshold of 5 billion shillings by the end of 2026, as one or two institutions may struggle to meet the target, Governor Kamau Thugge said. Thugge said in remarks reported by Capital FM on 2 November 2026 that the bank wants to hear plans from banks that still need to strengthen their capital bases. “There are a few banks we want to come and tell us how they will get to 5 billion shillings. We also want to hear from the few, perhaps one or two, that may struggle to meet the target,” he said. The request for explanations comes as the 2026 Finance Act extended the deadline for meeting the final threshold of 10 billion shillings to December 2032 and scrapped the annual milestones. That leaves banks facing two parallel tracks: a longer deadline for the final threshold and an immediate supervisory request to explain how they will reach the 2026 threshold.
According to Capital FM, the 2026 Finance Act scrapped the annual milestones that linked capital increases to successive deadlines and extended the deadline for the minimum threshold of 10 billion shillings to December 2032. The previous plan, as reported by Business Daily Africa, required banks to reach 5 billion shillings by the end of 2026, then 6 billion by the end of 2027, 8 billion in 2028 and 10 billion by the end of 2029. Those figures no longer represent an annual schedule under the amended law; they show the path previously approved before the deadline was extended. The Business Laws (Amendment) Act of 2024 had raised the minimum from 1 billion shillings to 10 billion over five years. The reform covered commercial banks and mortgage finance companies, according to the Central Bank’s 2024 annual bank supervision report.
The governor’s remarks indicate that the extension has not ended the central bank’s monitoring of banks’ ability to increase capital. He said the institution is engaging with the Treasury on the requirements to ensure banks strengthen their capital bases. The central bank also plans to summon commercial banks to explain how they intend to meet the minimum, according to Capital FM. In a separate report, Business Daily said the regulator had asked banks with capital below 5 billion shillings to submit written explanations of their plans before the end of the year. These steps give the authorities a picture of which banks need more time or additional measures to meet the requirements. The governor identified only “a few” banks whose plans he wants to hear, saying one or two may struggle, without giving a larger number.
The supervisory push follows the 2025 bank supervision report, which showed that 7 commercial banks had failed to meet the minimum core capital requirement of 3 billion shillings as of 31 December 2025. Disclosures for the quarter ended 31 March 2026 also showed that Credit Bank, Consolidated Bank of Kenya, Development Bank of Kenya and Access Bank Kenya were below the 3 billion shilling threshold. These figures relate to the 3 billion shilling threshold in earlier periods, while the governor’s current request concerns plans to reach 5 billion by the end of 2026. Thugge attributed the need for higher capital requirements to economic shocks, including climate change and cyberattacks on financial institutions. He said a strong capital base helps banks continue lending and defend themselves against shocks, and that the failure of one bank could affect the entire banking sector.