Banks loan restructures surpass the Ksh.1 trillion mark
Local commercial banks have continued restructuring borrower loans in line with the directives of the Central Bank of Kenya (CBK) to cushion clients against the pandemic.
Combined, the sector-wide loan restructures hit Ksh.1.12 trillion at the end of August according to new CBK data published on Tuesday.
The total restructures represent 38 per cent of the total banking sector loan book tabulated at Ksh.29 trillion.
A partly Ksh.271 billion of the restructures represents personal and household loans while the majority Ksh.849.5 billion represents restructures to other economic sectors including trade, manufacturing and real estate.
The loan restructures which include payment holidays and lengthened payment periods are intended at providing reprieve to borrowers.
The loan restructures took effect from March 18 and are expected to remain in place for a maximum period of one year pending the guidance of the CBK.
In spite of the restructures, banks have continued to see the deterioration of their assets quality with the ratio of gross non-performing loans soaring to 13.6 percent in August from 13.1 percent in June.
The worsening books have seen banks set aside billions as cover for potential borrower defaults in the near term.
For Citizen TV updates
Join @citizentvke Telegram channel
Video Of The Day: | TALES OF LAMU | Island grappling with an acute shortage of fresh water