@stocksguru7 kenyan banks are way above the threshold set by the basel....

They are too well capitalised and comply with all international standards....

Guru267-On what basis have you come to that conclusion that they are better capitalised than international standards. do you anything about Basel 2?

guru267-so does that mean every bank in Kenya has enough capital to cover its Pillar 1 risks(credit;market;operational) its Pillar 2 risks and is doing its Pillar 3 disclosures?

Lets talk about things you know about madam

@Wa_ithaka don't insult my intelligence....

As soon as this thing was passed CBK issued a statement saying that all banks complied with these regulations....

So i'd like you to show me exactly which ones don't comply and How

Though I'm not a banker, my simple understanding shows that the CBK statement may only have been political. @guru267, this reports from CBK may not fully agree with you key findings on pg5/6


@Wa_ithaka had a point, put across tactlessly...
South Africa was the first African country to fully implement Basel II accord and this was spearheaded by their Reserve Bank. In fact, Kenyan banks with SA counterparts will testify to the nightmare!

In assessing credit risk they come up with these risk-weightings that impair capital, which need the regulator's approval; risk-weights are applied to all borrowers based on loads of additional customer information.

Requirements of the second pillar have far reaching impact on supervision, operations, market, liquidity, counterparty aspects of banking operations.

Regulator comes in on the third pillar, necessitating an overhaul of the framework of daily/monthly/annual reporting, and holding banks legally responsible for compliance to Basel II.

Touché veteran comrade.
Aiissh, can't help it! Sometimes I think when I was born, I just started talking instead of screaming...

But made the point without the "BS" quip which may have been insulting. Also attached a link to counter @guru267 argument.

Yes, let's talk about the things we know. Which banks have not complied with all the above? Or instead have the Kenya listed banks or the Top Ten banks in Kenya complied with the above fully? I'm curious to know. Cos i made the same assumption as guru267.

@Wa_ithaka, agreed again. I'm not a banker, but from my simple understanding NONE. In fact, a 2010 survey from BIS Institute points out that only 3 jurisdictions in Africa (excl SA) should be implementing 2010. You see implementation of the Basel framework is normally from a country standpoint.

Please refer to pages 5/6 of Basel Implementation Survey
1. Majority of the institutions rated the level of awareness of Basel II as medium (on scale of high, medium and low). There is therefore need to enhance Basel II awareness in institutions.

2. The key reasons for low awareness of Basel II in some institutions were cited as:
a. Lack of prerequisite human resource competences.
b. Basel II is not considered a competitive tool.
c. It is not a regulatory requirement.

7. Majority of the local institutions (76%) will be ready to implement Basel II from 2010. This is in contrast to international banks, a majority (72%) of whom have indicated that they are ready to implement Basel II.

8. Only 3 out of the 24 local institutions surveyed have set aside specific budgets for Basel II implementation. 2 other institutions are actively considering a Basel II budget, while in one other institution investments in I.T. systems and training incorporate Basel II requirements.


In 2009 Banking Supervision Annual Report, CBK assessed Kenya on the basis of compliance to 25 Basel Core Principles for effective bank supervision. They noted Kenya is compliant or largely compliant with 18 principles; improving from 16 principles in 2003. Realise though, that Basel Core Principles remain neutral regarding the implementation of Basel I or Basel II frameworks.

@Wa_ithaka when i said kenyan banks comply fully i was talking about mostly the capital aspect which is so due to default capital regulations set by the CBK being more stringent than basle....

I'm pretty sure we both know that the one of the only realistic measure of emerging market bank strength arises from the strengh of their capital base...

guru267-How are they more stringent than Basel 2 when they don't take account of a bank's risks and only focus on amount of capital a bank should hold?

Kenyan banks are not Basel 2 compliant