Basel Accords on Risk Management: A Survey of Kenya s Commercial Banks
Ojwang George Omondi*
Department of Business Studies, Siaya Institute of Technology, Kenya
- *Corresponding Author:
- Ojwang George Omondi
Lecturer, Department of Business Studies
Siaya Institute of Technology, Kenya
E-mail: [email protected]
Received: August 24, 2015 Accepted: December 01, 2015 Published: December 07, 2015
Citation: Omondi OG (2015) Basel Accords on Risk Management: A Survey of Kenya’s Commercial Banks. J Glob Econ 3:164. doi:10.4172/2375-4389-1000164
Copyright: © 2015 Omondi OG. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
In 2012 the Central bank of Kenya issued revised and new prudential and risk management guidelines applicable to commercial banks, mortgage finance companies and non-bank financial institutions licensed under the Banking Act of Kenya. This was informed by the need to up-date the banking sector regulatory framework in light of significant changes in local, regional and global banking sector’s operating environment. Key drivers included a desire to adapt new global best practices in banking sector such as the revised Basel Core Principles Banking Supervision. Among the guidelines issued include regular stress testing by commercial banks and the submission of a report to Banking Supervision Department on a quarterly basis. This paper investigated risk management techniques employed by commercial banks in Kenya and recorded several techniques including stress testing and contingency planning.