Future CBK governors to be approved by Parliament

FUTURE Central Bank governor appointments will have to approved by Parliament if the ammendments of the CBK Act as proposed are approved. Finance Minister Njeru Githae will table before Parliament the Central Bank (Ammendment) Bill 2012, which among others stipulate that the governor is appointed by the President throuhg a transparent and competitive process with the approval of Parliament.

The ammendment, if passed, is going to remove the confusion that has for years surrounded the appointment of CBK governors, a role that is a currently a sole prerogative of the head of state. The President is currently free to appoint anyone he likes with no interviews for the job conducted.

Current governor Njuguna Ndung'u told a committee of Parliament that was investigating the rapid fall of shilling early this year that he did not know how we was appointed. Ndung'u said he only received a call from West Africa informing him that he had been appointed governor.

According to the proposed amendments, the President will also appoint a chairperson of the Central Bank through a transparent and competitive process. The chairperson appointment will also have to be approved by Parliament.

This will be the first time the CBK will have a chairperson who is not the governor. Njuguna is currently the chairperson of the CBK board that also include Treasury PS Joseph Kinyua. Both the governor and the chairperson will serve for a period of four years but will be eligible for reappointment for one further term.

The governor shall act as the chief executive officer of the CBK responsible for the management of the bank including organisation, appointment and dismisal of staff. For appointment as a governor or deputy, a person must have over 10 years experience at seniour management level in the field of economics, banking, finance or law.