The Kenya School of Monetary Studies was established and registered as a corporate entity under the Companies Act (CAP. 486) Laws of Kenya and Limited by Guarantee in 1997 to build capacity in response to the bank failures in 1980/1990s. The bank failures were mainly attributed to inadequate staff with requisite skills in banking and financial management, economic reforms arising from World Bank/IMF Structural Adjustment Programme and inadequate postgraduate economists required to formulate economic policies. The school started off by taking over short term management and skill development programmes hitherto run by the defunct College of Banking and Finance (CBF).
The shareholders of the school are Central Bank of Kenya (99% Share) and Ministry of Finance (1% Share). The Shareholders found it necessary to establish KSMS as an institution dedicated to serving the Banks mandate of fostering a stable and well-functioning financial system.
Over the years, the School has made significant contribution towards the creation of a critical mass of skills envisaged by Vision 2030. Besides, it has acquired international reputation through its training programmes and research through collaborations with local Universities to offer specialized graduate level programme and hosting of international institutions.