IFRS 9: The impact on banks, customers and the economy

Lawrence Kimathi is KCB Group Chief Finance Officer

At the beginning of this year, Kenyan banks joined their global peers in adopting the International Financial Reporting Standards 9 (IFRS 9), ushering in a significant shift in accounting for financial instruments.

As the financial institutions settle in under the new regime — which among other things requires that provisions are made on the basis of expected, rather than realised loan losses — focus is shifting to the impact this would have on the banking sector and the economy as a whole.