SBM Bank Kenya reported KSh9.7 billion in gross non-performing loans for September, according to its latest financial figures. The bank’s total capital ratio fell to 14.4%, below the minimum regulatory requirement. This follows a period of earnings recovery in the first half of the year.
The increase in non-performing loans raises concerns about the bank’s financial stability. The capital ratio, which measures a bank’s ability to absorb losses, is now at a level that may not meet central bank guidelines. The bank has not yet announced specific measures to address the issue.
This development comes amid broader challenges in Kenya’s financial sector. Recent reports highlight growing risks in loan portfolios across several institutions. The central bank has been urging banks to improve risk management and maintain adequate capital reserves. SBM Bank’s situation underscores the need for stronger oversight and regulatory compliance.
The bank’s financial health will be closely watched in the coming months. Any further decline in capital could lead to increased scrutiny from regulators. The situation highlights the ongoing pressures facing financial institutions in Kenya.
