Industry
KDIC strengthens banking supervision with new data system
Monday 04 April 2022
Mohamud Mohamud, Managing Director of Kenya Deposit Insurance Corporation. PICTURES | NJAU SALATON | NMG
Summary
- The Kenya Deposit Insurance Corporation has strengthened supervision of banking institutions after investing 229 million shillings ($2 million) in a modern data collection and analysis system.
- The KDIC is among the state agencies empowered to monitor financial institutions and detect suspicious financial transactions and financial malfeasance.
- Recent bank collapses – including Dubai Bank in August 2015, Imperial Bank in October 2015 and Chase Bank in April 2016 – were the result of fraud and insider trading.
The Kenya Deposit Insurance Corporation has strengthened supervision of banking institutions after investing 229 million shillings ($2 million) in a modern industry data collection and analysis system.
KDIC – the agency that runs the deposit insurance system for customers – says its data warehouse will be live in less than a year, which will enhance early detection of suspicious financial transactions and malfeasance that could lead to the collapse of a bank.
“The data warehouse will help in mitigating bank failures as we will get timely data, analyze the data and it can quickly inform corrective decisions from some of the data,” Chief Executive Mohamud Ahmed Mohamud said.
“It’s a real added value because even the banks will be more careful about the type of data they are going to introduce. It can, for example, quickly detect for you if there are misalignments in the data that you do not can’t see with the naked eye.
The KDIC is among the state agencies empowered to monitor financial institutions and detect suspicious financial transactions and financial malfeasance. Others are the Central Bank of Kenya – the financial services regulator – and the Financial Reporting Centre, the anti-money laundering agency.
Recent bank collapses – including Dubai Bank in August 2015, Imperial Bank in October 2015 and Chase Bank in April 2016 – were the result of fraud and insider trading.
“All bank data will now be deposited in this electronic data warehouse to ensure its integrity, accuracy and timeliness,” Mohamud said.
“It’s something that’s going to be a game-changer for us so that with one click we can get all the data we want.”
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