New Central Bank of Kenya Governor Dr Kamau Thugge has heightened his push for the consolidation of commercial banks in the country saying Kenyans are currently overbanked.

Dr Thugge says he will push for merger of the financial institutions instead of the 39 existing commercial banks competing for the small markets and undertook to look into the matter.

“We can encourage more mergers and reducing the number of banks, it’s something I would like to pursue and look into.

Speaking at the launch of the Kenya and DRC Investors’ Roadshow by Equity Group, the CBK boss said the government wanted fewer banks to serve the more than 55 million Kenyans.

However, the CBK is yet to come up with the ideal number of banks it feels is suitable for the financial services sector.  

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“Ultimately, we will see what goes but I can’t tell you right now what the optimal number of banks will be,” he revealed. 

Dr Thugge spoke even as he projected a stout economic growth of 5.5 per cent by the end of this year based on the recovery of the country’s agricultural sector after failed harvests.

“Going forward, we expect the economy to grow quite robustly, by at least 5.5% in 2023, driven by a recovery in Agriculture which started showing signs of recovery in the first quarter,” said Dr Thugge.

He stressed on the government’s commitment to address the current high inflation the country continues to grapple with resulting from a variety of internal and external factors.

“At the Central Bank, we have taken the position that we are going to be quite aggressive in addressing inflationary pressures, and that's why we increased the CBR by 100 basis points,” he said.


The new CBK boss said the banking regulator will only intervene to stabilize the current volatile foreign exchange market against the favour of the Kenyan Shilling as a last resort.

“On exchange rates, we are pursuing a flexible exchange rate system and we will intervene when we feel that there is excessive volatility in the exchange rate.

“Otherwise, we will allow the exchange rate to find its own level through supply and demand forces.”