Challenges facing investment banking in Kenya

Abstract

Banking business is faced with many challenges, one of them being the turbulent changes in the competitive environment. Investment banking is no exception. This study investigates the challenges and factors facing investment banking in Kenya Data was collected using a semi-structured questionnaire. 30 commercial banks, 3 investment banks, and 18 investment advisors,. responded to the questionnaire. This data was thereafter analyzed using mean scores, percentages and factor analysis to identify the most important factors and challenges influencing investment banking. The analysis revealed that both internal and external factors have the biggest impact to the investment banking industry. Internal factors included weak policies, poor management and low capitalization, while external .f.actors included high inflation, high interest rates, poor governance and political' instability. The challenges facing investment banking included technological changes, demographic factors, lack of active trading market and globalization.