From reading a 1968 book Who Controls Industry in Kenya – a report of a working party comes some history of the Kenyan banking sector. It mentions that in 1968;
– Kenya had 10 banks and all but 3 banks were foreign bank off-shoots.
– They had given loans of loans of £70m, deposits of £83m – a book ratio of 83%, compared to US or UK which had ratios of between 33% to 50%
– Depositors received 3-4% interest on deposits and paid interest of 7-8% on loans [today deposit rates are about the same but loan borrowers pay 12 – 25%]
There were two tiers of banks then;
The Big 3 Banks which 3 held 80% of deposits and 85% of bank assets amounting to K£111 million in 1966 were
– Barclays Bank: Had assets of UK£1.4 billion and had 83 branches, and Kenyan directors included Michael Blundell, S. Waruhiu and J. Opembe. Today it has 111 branches
– Nation & Grindlays (now KCB): Had assets of UK £401 million and after-tax profit of £1.2 million. It had 50 branches, and 16 directors who were all British. Today KCB has 165 outlets in Kenya
_ Standard Bank (now Standard Chartered): With assets of UK £892 million and a net profit of £3.1 million. It had 41 offices, 22 directors all British.
Next 7 Banks
– Bank of Baroda
– Ottoman Bank
– Bank of India
– African Banking Corporation (subsidiary of Standard Bank)
– Commercial Bank of Africa
– Algemene bank (General Bank of Netherlands)
– Habib bank
– Cooperative Bank of Kenya (established in 1967)
– National Bank of Kenya (established in 1968)
– National industrial credit (then 40% owned by Standard Bank, now NIC)
– United Dominions Corporation
– Credit finance company (now CFC Stanbic)
Others registered as ordinary companies:
– Transaction Finance Corporation (subsidiary of Cooper Motor Corporation CMC)
– Industrial promotion services (Now IPS, was est. in 1963 by the Aga Khan)
– Africindo Industrial Development (powerful Asian industrialists seeking credit facilities for exports to India with training for Kenyans there)
The big three commercial banks also owned development corporations to undertake longer-term investments than normal banks accepted; these were Barclays Overseas Development [assets of UK£9m and 88 projects in East Africa], National & Grindlays Finance and Development [B£3m] and Standard Bank Development Corporation.
As at 1964, they had loaned UK£3m more than they had in deposits; this was after sudden withdrawal in 1959 of £4m savings by European and Asian depositors.
– Savings & Loan Society
– East African Building Society
– First Permanent (East Africa)
– Kenya building society (subsidiary of Commonwealth Development Corporation CDC)
– Housing Finance Company of Kenya (now Housing Finance)