This brief presents analyses of Kenya’s domestic debt that is held by commercial banks, especially the top-performing domestic commercial banks in the country. The research adopted a desk-top review method where data was extracted from the central bank of Kenya’s website and documents and the domestic commercial banks’ website and documents.

The research findings indicated that domestic debt was more expensive than external debt, the ratio of total domestic debt: total external debt was approximately at 50:50 and that the domestic commercial banks held 50% of the total domestic debt. Further, for the years between 2017 to 2019, Kenya Commercial Bank, Equity Bank and Cooperative Bankof Kenya were the largest commercial banks in the country based on asset and customer portfolio, yet they were the largest holders of the government’s domestic debt held by commercial banks.

WHAT DOES IT MEAN WHEN THE GOVERNMENT BORROWS FROM THE LOCAL COMMERCIAL BANKS



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