Central Bank of Kenya Governor Dr. Patrick Njoroge during a past event. CBK has frozen its base lending rate.

President Uhuru Kenyatta has extended the terms of Central Bank of Kenya (CBK) Governor Patrick Njoroge, Chairperson Mohammed Nyaoga and Deputy Governor Sheila M’Mbijiwe by four years.

In a special gazette notice, President Kenyatta has extended the terms of the three until 2023. Their contracts were due to run out on June 19, 2019.

Njoroge who was appointed in June 2015 has managed to ensure that the shilling has remained steady averaging Sh101.97 to the US dollar during his time in office while inflation has been confined to rates recommended by the government and international institutions.

Earlier this week, reports emerged that the president was likely to retain Dr Njoroge.

According to the reports, President Kenyatta’s decision to hand Njoroge a second term is on the back of his success in steadying the Kenyan currency and his  efforts in lobbying lenders to avail loans to Micro, Small and Medium Enterprises (MSMEs).

Njoroge will now be tasked with overseeing the country’s adoption of the new currency and ensuring strict adherence to banking laws to stem illicit financial flows.

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{Read: Banks to reconfigure ATM machines to suit new currency}

Speaking to the press last week, Njoroge stayed clear on his possible reappointment and asked journalists to direct their questions to President Kenyatta, the appointing authority.

Last week, the CBK governor caught the country unawares when he announced that the government will be withdrawing out the Ksh1,000 note from October this year, a move aimed at devaluing dirty money and ensuring that hoarded money circulates in the economy.

{See also: Hoarded billions have the potential to inflate Kenya’s economy}

“If you are sitting on money and you are unable to explain how you acquired it, then it becomes paper so come October it will be paper, it will be worthless,” said Njoroge in a follow up press conference on Monday.

However Njoroge’s record at CBK headquarters is not without blemish.

CBK’s supervisory role was put on the spot between 2015 and 2016 when a number of popular banks collapsed.

Njoroge who was CBK Governor at the time was forced to explain why the regulator took to long to act despite evidence presented to it by whistle blowers on massive fraud at Chase Bank, Fidelity Bank, Imperial Bank and Dubai Bank.

“On the specifics, the case of Dubai Bank is straightforward we have put it in receivership. The reasons behind its liquidation were clear. There was alot of fraud, embezzlement, money laundering. The charge sheet is clear and we need to deal with the them (collapsing banks) appropriately,” said Dr Njoroge on May 31, 2016.

By the time Imperial Bank was put on receivership, Ksh34 billion had been moved fraudulently from the lender’s coffers before shareholders made it their mission to have the bank liquidated.

Former CBK Governor Andrew Mulei who was at the helm of the institution between 2003 and 2006 is on record stating that political interference makes it very hard for the regulator to play its supervisory role effectively.

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Samuel Gitonga is a senior reporter at BUSINESS TODAY. Email: [email protected]

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