Banks warned of risks from State corporation reforms - Business Daily

Analysts at law firm Bowmans warn commercial banks to reassess loans to state-owned enterprises, as the new GOE Act 2025 transforms these entities into public limited liability companies, removing implicit government guarantees. Non-guaranteed debt of state corporations stands at Sh44.87 billion, exposing taxpayers to fiscal risks. Banks must now assess credit risk on the strength of the entities' own balance sheets, without relying on sovereign support. Regulatory licenses and permits may not automatically transfer to successor companies.