Uhuru appoints five CBK directors after two-year delay

President Uhuru Kenyatta has finally appointed five Central Bank of Kenya (CBK) directors after a delay of almost two years, meaning the board can now have quorum.
The decision follows approval of the five by Parliament after a vetting exercise by the committee of Finance, Planning and Trade.

There has been concern that the absence of the board could compromise decision-making as the governor was left to implement policy without the backing of a board.

This was at a time the banking sector was shaken to the core following the collapse of three lenders in under a year.

“A quorum for any meeting of the board shall be the chairperson, the governor and three directors,” says the Central Bank of Kenya Act 2014.
Under the Act, the responsibility of determining the policy of the bank, other than the formulation of monetary policy, is given to the board.

The President appointed lawyer Mohamed Nyaoga in June last year to chair the new and more powerful board but did not immediately pick the eight non-executive members.

READ: Nyaoga’s star rises as he is named CBK board chairman

Others serving on the board are the Treasury Principal Secretary, and CBK Governor Patrick Njoroge.

There are still three non-executive vacancies on the board. The new members are Ravi J Ruparel, Nelius W Kariuki, Samson Cherutich, Charity Selina Kisotu and Rachel Bessie Dzombo. They will serve for a period of four years.

“In exercise of the powers conferred by section 11 (1) d of the Central Bank Act, I … appoint Rachel Bessie Dzombo, Samson K Cherutich to be members of board of the Central Bank of Kenya for a period of four years with effect from December 5 ,2016,” said Mr Kenyatta.

Mr Ruparel, Mrs Kariuki and Mrs Kisotu have been appointed for a period of four years with effect from November 4, 2016 in line with article 11(3) of CBK Act that demands members to be appointed at different times to keep the board functioning on expiry of some tenures.

The board will now be expected to have a committee specialising in matters relating to ensuring the stability of the financial sector as a whole.

The team will also set CBK’s policies, review performance of the governor and provide oversight over the regulator’s strategy and financial management.

Evaluate decisions

Under the CBK Act, the board is supposed to meet not less than once every two months to discuss the regulator’s performance, evaluate decisions made by management and consider capital investments.

The new members will join Mr Nyaoga who has been heading the board with no directors.

Mr Ruparel worked with Financial Sector Deepening Kenya as a senior policy advisor. The UK-backed FSD works towards ensuring financial inclusion.

Mrs Kariuki is former chairman of the Kenya Re board where she earlier served as a director.

Mr Cherutich is the current financial controller of Nairobi Hospital while Ms Kisotu has previously served as chairperson of the National Social Security Fund.

Ms Dzombo is the executive director of Danicha Investment Ltd.

The country’s financial sector is currently undergoing rapid changes, especially with the Bank Amendment Act, which caps interest rates charged on loans.