KBA hosts forum to strengthen credit analysis in banking

Panellists Dr Samuel Tiriongo (KBA) and Vidhyasagar Lingesan of Care Ratings during the event. [Brian Ngugi, Standard]

The Chartered Institute for Securities and Investment (CISI), in partnership with CareEdge Ratings and the Kenya Bankers Association Institute (KBAI), convened a high-level industry forum focused on strengthening credit analysis and lending decision frameworks within Kenya’s banking sector.

The event, themed “Enhancing Credit Analysis: Building Smarter, Stronger Bank Lending Decisions,” brought together banking professionals, risk managers, credit analysts, and financial market practitioners to explore evolving best practices in credit risk assessment.

The forum examined the practical application of Risk-Based Credit Pricing Models, the role of the newly rolled out Kenya Overnight Interbank Average Rate (KESONIA) as an emerging benchmark for loan pricing, and how banks can enhance borrower assessment using credit ratings and structured analytical techniques.

Discussions highlighted the importance of integrating independent credit opinions with internal credit analysis frameworks to improve the accuracy, consistency, and reliability of borrower creditworthiness assessments.  

In response to the need for more accurate borrower analysis to support lending decisions, the CISI, FSDA and the Chartered Banker, UK, developed the Fundamentals of Credit Risk Management (FCRM) programme, which provides a solid grounding in the relevant lending principles and products and covers a variety of lending sectors, including personal lending, corporate lending and microfinance.

The CISI and KBAI have also partnered to offer training to lenders on the programme.

Bernice Onyango, heading the KBA Institute, emphasised the importance of such initiatives. “This training underscores our commitment to strengthening credit risk capabilities by partnering with CISI and CARE Ratings (Africa) to equip professionals with practical credit analysis skills that support informed lending and financial stability”, Onyango said.

Additionally, Dr Samuel Tiriongo, Director of Research and Policy, KBA, underscored the importance of strengthening analytical frameworks within the banking industry.

“Robust credit analysis is fundamental to sound banking practice. Initiatives that promote deeper understanding of risk-based pricing, benchmark rates such as KESONIA, and improved borrower evaluation tools are critical to supporting prudent lending and sustainable economic growth,” Dr Tiriongo said.

Saurav Chatterjee, Director and CEO - CARE Ratings (Africa), highlighted the value of independent credit assessments in supporting banking sector risk management.

“Credit ratings provide an objective and standardised evaluation of an issuer’s creditworthiness, enabling lenders to better understand risk exposures and complement their internal credit appraisal processes,” Saurav stated.

Kimacia Gitau, CISI East Africa Lead Representative, emphasised the importance of strengthening professional competence in credit risk analysis.

“As lending environments grow more complex, financial professionals must adopt structured, data-driven credit analysis that integrates risk-based pricing models and credible credit assessments to enhance lending decisions and strengthen financial stability. The FCRM programme ensures lending practitioners are well covered in this area,” Mr Gitau noted.