Section 2 of The Banking Act CAP 488: Interpretation

(1) In this Act, unless the context otherwise requires—
"agency" means an entity contracted by an institution and approved by the Central Bank or subcontracted by such entity to provide the services of the institution on behalf of the institution, in such manner as may be prescribed by the Central Bank:
Provided that where such entity is a co-operative society, prior approval to provide the services shall be sought from the Sacco Societies Regulatory Authority established under the SACCO Societies Act (Cap. 490B);
"assigned capital" has the meaning given to it in section 7(4);
"bank" means a company which carries on, or proposes to carry on, banking business in Kenya but does not include the Central Bank;
"banking business" means—
(a) the accepting from members of the public of money on deposit repayable on demand or at the expiry of a fixed period or after notice;
(b) the accepting from members of the public of money on current account and payment on and acceptance of cheques;
(c) the employing of money held on deposit or on current account, or any part of the money, by lending, investment or in any other manner for the account and at the risk of the person so employing the money; and
(d) such other business activity as the Central Bank may prescribe;
"banking group" means a licensed institution and its subsidiaries, non-operating holding companies and subsidiaries of its non-operating holding companies;
“beneficial owner” has the meaning assigned to it under the Companies Act (Cap. 486);
"Board" means the Deposit Protection Fund Board established by section 36;
"branch" means any permanent premises, other than its head office, at which an institution transacts business in or outside Kenya;
"Cabinet Secretary" means the Cabinet Secretary for the time being responsible for matters relating to Finance;
"capital" means paid-up share capital or, in the case of an institution incorporated outside Kenya, its assigned capital;
"competent authority" means any of the bodies set out in the Third Schedule;
"convertible currency" means currency which is freely negotiable and transferable in international exchange markets at exchange rate margins consistent with the Articles of Agreement of the International Monetary Fund;
"co-ordinator" means the Central Bank;
"core capital" means permanent shareholders’ equity in the form of issued and fully paid-up shares of common stock, or in the case of foreign incorporated banks, of the assigned capital, plus all disclosed reserves, less goodwill or any other intangible assets;
"current account" means an account maintained by a bank for and in the name of, or in a name designated by, a customer of the bank into which money is paid by or for the benefit of such customer and on which cheques and other bills of exchange may be drawn by, and transfers and other banking transactions made on the instructions of, the customer;
"disclosed reserves" includes all reserves created or increased through share premiums, retained profits (after deducting all expenses, provisions, taxation and dividends) and general reserves if such disclosed reserves are permanent and unencumbered and thus able to absorb losses;
"financial business" means—
(a) the accepting from members of the public of money on deposit repayable on demand or at the expiry of a fixed period or after notice; and
(b) the employing of money held on deposit or any part of the money, by lending, investment or in any other manner for the account and at the risk of the person so employing the money;
"financial institution" means a company, other than a bank, which carries on, or proposes to carry on, financial business and includes any other company which the Cabinet Secretary may, by notice in the Gazette, declare to be a financial institution for the purposes of this Act;
"financial year" means the financial year prescribed in section 20A;
"group" means a non-operating holding company, its subsidiaries and all associated companies of the parent or its subsidiaries;
"institution" means a bank or financial institution or a mortgage finance company;
"land" includes freehold and leasehold land in Kenya and all buildings and permanent improvements thereon;
"licence" means a licence granted under section 5;
"members of the public" means individuals, partnerships, corporate bodies and trustees or managers of trusts, pension and provident funds or other similar funds;
"mortgage finance company" means a company (other than a financial institution) which accepts from the members of the public, money—
(a) on deposit repayable on demand or at the expiry of a fixed period or after notice; or
(b) on current account and payment on and acceptance of cheques, and is established for the purpose of employing such money in accordance with section 15;
"non-operating holding company" means a company, other than the institution, which has approved control of an institution and whose activities are limited to holding investments in subsidiaries, holding properties used by group members; raising funds to invest in, or to provide support to, subsidiaries, raising funds to conduct its own limited activities, investing funds on behalf of the group, conducting the banking activities required for its own limited functions, and providing administrative, risk management and financial services to support the efficient operation of the group;
"officer", in relation to an institution, means a Director or any other person, by whatever name or title he may be called or described, who carries out or is empowered to carry out functions relating to the overall direction in Kenya of that institution or takes part in the general management thereof
in Kenya;
"place of business" means any premises, other than the head office, including a branch, an agency or a mobile unit, or such other premises as may, from time to time, be prescribed by the Central Bank, at which an institution transacts banking or financial business and which is open to the public;
"public entity" means the Government, a local authority or a public body declared by the Cabinet Secretary to be a public entity for the purposes of this Act;
"representative office" means an office established in Kenya under the provision of Part IX;
“significant shareholder” means a person including a beneficial owner, other than the Government or public entity, who holds, directly or indirectly, or otherwise has a beneficial interest amounting to five per cent or more of the share capital of an institution or a corporate entity seeking to become an institution;
"significantly undercapitalized" in relation to an institution, means that the institution holds less than-fifty percent of the capital requirements prescribed under section 18;
"supplementary capital" means general provisions which are held against future and presently unidentified losses that are freely available to meet losses which subsequently materialize, and revaluation reserves on banking premises which arise periodically from independent valuation of such premises, and any other form of capital as may be determined from time to time by the Central Bank;
"the Central Bank" means the Central Bank of Kenya established by the Central Bank of Kenya Act (Cap. 491);
"total capital" means the total sum of core capital and supplementary capital;
"total deposit liabilities" means the total deposits in or outside Kenya in any institution which are repayable on demand or after a fixed period or after notice;
"undercapitalized bank" means an institution that does not fully comply with the capital requirements prescribed in section 18;
"unimpaired reserves" means capital and revenue reserves not subject to any charge or other encumbrance or option or liable to reduction by payment of dividend or otherwise.
(2) For the purposes of this Act, "associate"—
(a) in relation to a company or other body corporate means—
(i) its holding company or its subsidiary;
(ii) a subsidiary of its holding company;
(iii) a holding company of its subsidiary;
(iv) its non-operating holding company as its subsidiary;
(v) a subsidiary of a non-operating holding company;
(vi) any person who controls the company or body corporate whether alone or with his associates or with its associates;
(b) in relation to an individual means—
(i) any member of his family; and
(ii) any company or other body corporate controlled directly or indirectly, by him whether alone or with his associates;
(iii) deleted by Act No. 57 of 2012, s. 38(b)(iii), and a person shall be deemed to be a member of a family if he is the parent, spouse, brother, sister,
child, uncle, aunt, nephew, niece, stepfather, stepmother, stepchild and adopted child of the person concerned, and in case of an adopted child his adopter or adopters.
(3) For purposes of subsection (2), the term "control" includes—
(a) the ability to influence, whether directly or indirectly, the composition of the board of directors of a company or any other body corporate;
(b) holding, directly or indirectly, whether personally or through a holding company or companies or subsidiaries thereof, or in any otherway, an aggregate of twenty per centum or more of the voting power of a company or body corporate, whether alone or with associates or with other associates of the company or body corporate; or
(c) as may be determined by the Central Bank, where a person has the ability to exercise a dominant influence over the management or policies of a company or body corporate on the basis of an agreement or by any other means, regardless of the amount of formal ownership or voting rights