Nairobi, June 16 -- The banking sector is arguably the pulsating heart of any economy in the globe. When it is pumping sturdily, private credit flows, businesses thrive, and jobs are created. When it wavers, the entire economic system could suffer a cardiac arrest.

This is why the Central Bank of Kenya's (CBK) directive instructing a 10-fold increase in core capital, from Sh1 billion to Sh10 billion by 2029, was not a mere regulatory annoyance but a very important operation.

Under the Business Laws (Amendment) Act, Kenyan banks face progressive targets under a staggered five-year plan: Sh3 billion by 2025, Sh5 billion by 2026, Sh7 billion by 2027, Sh8 billion by 2028, and Sh10 billion by 2029. Whereas most tier-1 and 2 banks are already...