DevAime/Financial-risk-management-kenyan-banks

This project presents a comprehensive financial risk management analysis for major Kenyan commercial banks (Kenya Commercial Bank, Equity Bank, and Co-operative Bank) # Financial Risk Management for Kenyan Banks ## Project Overview This project presents a comprehensive financial risk management analysis for major Kenyan commercial banks (Kenya Commercial Bank, Equity Bank, and Co-operative Bank). The analysis is divided into two main components: 1. **Value-at-Risk (VaR) Analysis** - Quantifying market risk exposure using multiple methodologies 2. **Stress Testing & Scenario Analysis** - Evaluating bank resilience under adverse macroeconomic conditions The project demonstrates practical application of risk management techniques mandated by the Central Bank of Kenya (CBK) and Basel III regulatory framework. > **Live Demo**: Interactive Dashboard --- ## Table of Contents - Data Sources - Part 1: Value-at-Risk Analysis - Part 2: Stress Testing & Scenario Analysis - Interactive Dashboards - Installation & Setup - Project Structure - Key Findings - References --- ## Data Sources ### Stock Price Data - **Source**: Wall Street Journal (WSJ) financial database via Investing.com - **Frequency**: Daily closing prices - **Period**: August 26, 2020 - November 27, 2025 - **Format**: CSV files with Date and Close columns ### Interest Rate Data - **Source**: Central Bank of Kenya (CBK) - **Variables**: 91-day T-Bill rate, Central Bank Rate (CBR), interbank rates - **Frequency**: Monthly observations - **Period**: January 2010 - August 2025 ### Exchange Rate Data - **Source**: CBK foreign exchange statistics - **Pair**: KES/USD - **Frequency**: Daily rates - **Period**: November 2020 - November 2025 ### Bank Financial Data - **Source**: Derived from stock market capitalizations and historical data - **Methodology**: Assets estimated from cumulative price data; equity calculated as 10% of total assets (typical banking leverage) - **Note**: Actual bank balance sheets from annual reports would provide more precise capital structure data --- ## Part 1: Value-at-Risk Analysis ### Overview Value-at-Risk (VaR) measures the maximum pote …