Cull, RobertBeck, ThorstenFuchs, MichaelGetenga, JaredGatere, PeterRanda, JohnTrandafir, Mircea2012-03-192012-03-192010-10-01https://hdl.handle.net/10986/3924Although Kenya's financial system is by far the largest and most developed in East Africa and its stability has improved significantly over the past years, many challenges remain. This paper assesses the stability, efficiency, and outreach of Kenya's banking system, using aggregate, bank-level, and survey data. Banks' asset quality and liquidity positions have improved, making the system more resistant to shocks, and interest rate spreads have declined, in part due to reduction in the overhead costs of foreign banks. Outreach remains limited, but has improved in recent years, driven by mobile payments services in the domestic remittance market. Fostering a level regulatory playing field for all deposit-taking institutions is a key remaining challenge. Specifically, an effective but not overly burdensome framework for regulation and supervision of microfinance institutions and cooperatives is a priority. Maintaining an openness to new, and non-bank, providers of financial services, which has enabled the success of mobile payments, could also further outreach.CC BY 3.0 IGOACCESS POINTSACCESS TO BANKINGACCESS TO BANKING SERVICESACCESS TO FINANCEACCESS TO FINANCIAL SERVICESACCESS TO LOANSACCESS TO SERVICESACCOUNTINGASSET QUALITYASSETS RATIOAUTONOMYBAD DEBTSBALANCE SHEETSBANK ACCESSBANK BRANCHESBANK COMPETITIONBANK FAILUREBANK FAILURESBANK INDONESIABANK PRIVATIZATIONBANK SERVICESBANKING CRISESBANKING CRISISBANKING INDUSTRYBANKING REFORMBANKING SECTORBANKING SECTOR ASSETSBANKING SECTOR EFFICIENCYBANKING SECTOR STABILITYBANKING SERVICESBANKING SYSTEMBANKING SYSTEMSBANKSBONDBOND MARKETSBORROWINGCAPITAL ADEQUACYCAPITAL ADEQUACY RATIOSCAPITAL FLOWSCAPITAL REQUIREMENTSCAPITAL RETURNCAPITALIZATIONCENTRAL BANKCOMMERCIAL BANKCOMMERCIAL BANKINGCOMMERCIAL BANKSCOMPETITIVE MARKETCONSOLIDATIONCONTRACT ENFORCEMENTCOOPERATIVESCORPORATE GOVERNANCECOST OF CREDITCOUNTRY COMPARISONSCREDIT REGISTRYCREDIT RISKCREDITORSDEBTDEBT ISSUANCEDEBT RECOVERYDEFAULTSDELIVERY OF CREDITDEPOSITDEPOSIT INSURANCEDEPOSITORDEPOSITORSDEPOSITSDEVELOPMENT BANKDISPUTE RESOLUTIONDIVERSIFICATIONDOMESTIC BANKSEARNINGSECONOMIC GROWTHECONOMIES OF SCALEEDUCATIONAL ATTAINMENTEMERGING ECONOMIESEMERGING MARKETSEMPLOYMENTEQUITY RATIOSEXCHANGE RATESEXPENDITURESEXTERNAL AUDITORSFINANCESFINANCIAL CONGLOMERATESFINANCIAL CRISESFINANCIAL CRISISFINANCIAL DEVELOPMENTFINANCIAL EXCLUSIONFINANCIAL INFRASTRUCTUREFINANCIAL INSTITUTIONFINANCIAL INSTITUTIONSFINANCIAL INTERMEDIATIONFINANCIAL MARKETSFINANCIAL PRODUCTSFINANCIAL SAFETYFINANCIAL SECTOR ASSESSMENTFINANCIAL SECTOR DEVELOPMENTFINANCIAL SERVICEFINANCIAL SERVICESFINANCIAL STABILITYFINANCIAL SYSTEMFINANCIAL SYSTEMSFISCAL DEFICITFOREIGN BANKSFORMAL BANKFORMAL BANKINGFORMAL FINANCIAL SERVICESFRINGE BANKSGOVERNMENT BANKSGOVERNMENT DEBTGOVERNMENT REFORMGOVERNMENT SECURITIESHIGH INTEREST RATEHOLDINGSHOUSEHOLDSINFLATIONINFORMAL FINANCEINFORMAL FINANCIAL INSTITUTIONSINSTITUTIONAL REFORMSINSURANCEINSURANCE COMPANIESINSURANCE CORPORATIONINSURANCE SERVICEINSURANCE SERVICESINTEREST EXPENSEINTEREST INCOMEINTEREST RATEINTEREST RATE SPREADSINTEREST RATESINTEREST RATES ON LOANSINTERNATIONAL BANKINTERNATIONAL CAPITALINVESTMENT BANKSLIQUID ASSETSLIQUIDATIONLIQUIDITYLIQUIDITY POSITIONSLIQUIDITY RATIOSLOANLOAN LOSS PROVISIONSLOAN PORTFOLIOLOAN PORTFOLIOSLOAN REQUESTSLONG-TERM ASSETSMACROECONOMIC POLICIESMACROECONOMIC STABILITYMANDATESMARKET DISCIPLINEMARKET ECONOMYMARKET SEGMENTATIONMARKET STRUCTUREMATURITYMATURITY TRANSFORMATIONMFISMICROFINANCEMICROFINANCE INSTITUTIONSMIGRATIONMINIMUM CAPITAL REQUIREMENTSMONEY TRANSFERNET INTEREST MARGINNON-PERFORMING LOANNON-PERFORMING LOANSNONPERFORMING LOANSNPLOPERATING COSTSOPERATING INCOMEOUTREACHOVERHEAD COSTSOWNERSHIP STRUCTUREPAYMENTS SERVICESPENSIONSPRIVATE BANKINGPRIVATE BANKSPRIVATE CREDITPRIVATE SECTOR BANKSPRIVATIZATIONPRIVATIZATIONSPROFIT MARGINPROFIT MARGINSPROFITABILITYPRUDENTIAL REQUIREMENTSPUBLIC ENTERPRISESREGULATORY AUTHORITYREGULATORY FRAMEWORKREGULATORY POLICIESREMITTANCEREMITTANCESRESERVERESERVE REQUIREMENTRESERVE REQUIREMENTSRESERVESRETURN ON ASSETSRETURN ON EQUITYRISK MANAGEMENTRISK TAKINGRISK WEIGHTED ASSETSRURAL ACCESSRURAL BRANCHESSAFETY NETSAVINGSSAVINGS DEPOSITSSAVINGS SERVICESSELF-REGULATIONSHARE OF ASSETSSHORT-TERM DEPOSITSSMALL BANKSSTATISTICAL ANALYSISSTATUTORY REQUIREMENTSSTOCKSSUPERVISION OF BANKSSUPERVISORY FRAMEWORKSUPERVISORY POWERSTAXTAX RATETIER 1 CAPITALTREASURY BILLSURBAN AREASWEALTH CREATIONWorld Bank10.1596/1813-9450-5442