CfC Stanbic Bank has been downgraded to the middle-tier group after dropping its market share by 0.5 percentage points to 4.92 per cent.
The bank, majority held by South African lender Standard Bank, is now ranked seventh after swapping places with Commercial Bank of Africa which gained 0.72 percentage points to 5.12 per cent in a year when it recorded rapid growth of its retail customer base helped by the M-Shwari platform.
These were the only two banks that shifted between tiers in 2014 from their positions in 2013.
“Commercial Bank of Africa moved to the large peer group from the medium peer group while CfC Stanbic Bank moved to the medium peer group from the large peer group,” said CBK in the report.
“The changes in the market share were mainly occasioned by growth in customer deposits as banks deployed various strategies for deposits mobilisation.”
Kenyan banks are classified into three tiers based on a weighted composite index of their net assets, capital and reserves, customer deposits, number of loans and deposit accounts.
According to the Central Bank of Kenya, there were six large banks controlling a market share of 49.9 per cent, 16 medium lenders commanding a market share of 41.7 per cent and 21 small banks with a market share of 8.4 per cent to the period ended December 2014.
Top tier banks have a weighted index of five per cent and above, while middle-tier lenders have an index of between one and five per cent.
Those with less than one per cent are classified as small-tier lenders. Banks in the medium peer group increased their combined market share from 37.95 per cent in December 2013, coming at a time when many of them raised additional capital to meet new CBK requirements as well as aggressively expanding their operations.
The market share of banks in the large and small tiers declined last year having stood at 52.4 per cent and 9.66 per cent respectively in December 2013.
Cooperative overtook Equity, having been third in 2013, courtesy of a gain of 0.3 percentage points while Equity shed 1.09 percentage points in the index.
The top tier banks hold 48.8 per cent of the industry’s total assets of Sh3.19 trillion, 49.6 per cent of the total customer deposits of Sh2.29 trillion, 50.2 per cent of the industry’s capital and reserves of Sh501.7 billion and accounted for 61 per cent of pre-tax profits of Sh141 billion recorded last year.