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Dividend freeze looms as banks race to boost capital
The Governor of the Central Bank of Kenya (CBK) Dr Kamau Thugge when he appeared before the Finance and National Planning Committee chaired by Kuria Kimani at the Bunge Tower in Nairobi on March 25, 2025.
The Central Bank of Kenya (CBK) says banks with a core capital base below Sh10 billion will likely freeze dividends to retain all of their profits in a bid to meet new capital requirements, which seek to promote stability of the financial sector.
This signals a dividend drought for shareholders of the affected institutions including wealthy individuals and private equity firms, with most of the affected lenders being small or medium-sized banks.
