Commercial Banking in Kenya
EGERTON UNIVERSITY TOWN CAMPUS
FACULTY OF COMMERCE
DEPARTMENT OF ACCOUNTING, FINANCE & MANAGEMENT SCIENCE
NAME: OCHIENG JARED OPONDO
REG NO: C12/60275/09
GROUP: A
FACULTY: COMMERCE
COURSE: BCOM 330; Financial Institutions and markets
TASK: TERM PAPER
TITLE: COMMERCIAL BANKING IN KENYA
PRESENTED TO: MRS. BOSIRE MARY
PRESENTED ON: 19TH October 2011
ABSTRACT:
This term paper analyses the commercial banking system in Kenya. In particular it focuses on the history of commercial banks from a general perspective then narrows down to Kenya’s context. It looks at the importance of commercial banks in Kenya, the roles/functions of commercial banks. It then focuses on the regulations that govern the commercial banks. Lastly it looks at the contribution of commercial banks to Kenya’s economy.
TABLE OF CONTENTS
Abstract 2
Table of contents 3
Introduction 4
The history and development of commercial banks 5
Importance of commercial banks 9
Roles of commercial banks 10
Regulations of commercial banks 13
Contribution of commercial banks to Kenya’s economy 14
Summary 15
References 16
INTRODUCTION
A commercial bank is a type of financial intermediary and a type of bank. It raises funds by collecting deposits from businesses and consumers via checkable deposits, savings deposits, and time deposits. It makes loans to businesses and consumers. It also buys corporate bonds and government bonds. Its primary liabilities are deposits and primary assets are loans and bonds.
Banks work with short term funds. Their working capital consists mainly of moneys deposited by customers and withdrawable by them on demand or on short notice. If a bank lends such moneys for long periods or keeps them blocked in any other way, it will be unable to meet the demands of its depositors for withdrawal of cash, and will be forced to go into liquidation.
Banks are the main financial institutions operating in
FACULTY OF COMMERCE
DEPARTMENT OF ACCOUNTING, FINANCE & MANAGEMENT SCIENCE
NAME: OCHIENG JARED OPONDO
REG NO: C12/60275/09
GROUP: A
FACULTY: COMMERCE
COURSE: BCOM 330; Financial Institutions and markets
TASK: TERM PAPER
TITLE: COMMERCIAL BANKING IN KENYA
PRESENTED TO: MRS. BOSIRE MARY
PRESENTED ON: 19TH October 2011
ABSTRACT:
This term paper analyses the commercial banking system in Kenya. In particular it focuses on the history of commercial banks from a general perspective then narrows down to Kenya’s context. It looks at the importance of commercial banks in Kenya, the roles/functions of commercial banks. It then focuses on the regulations that govern the commercial banks. Lastly it looks at the contribution of commercial banks to Kenya’s economy.
TABLE OF CONTENTS
Abstract 2
Table of contents 3
Introduction 4
The history and development of commercial banks 5
Importance of commercial banks 9
Roles of commercial banks 10
Regulations of commercial banks 13
Contribution of commercial banks to Kenya’s economy 14
Summary 15
References 16
INTRODUCTION
A commercial bank is a type of financial intermediary and a type of bank. It raises funds by collecting deposits from businesses and consumers via checkable deposits, savings deposits, and time deposits. It makes loans to businesses and consumers. It also buys corporate bonds and government bonds. Its primary liabilities are deposits and primary assets are loans and bonds.
Banks work with short term funds. Their working capital consists mainly of moneys deposited by customers and withdrawable by them on demand or on short notice. If a bank lends such moneys for long periods or keeps them blocked in any other way, it will be unable to meet the demands of its depositors for withdrawal of cash, and will be forced to go into liquidation.
Banks are the main financial institutions operating in