By Beth Nyaga
President Uhuru Kenyatta has lauded the Central Bank of Kenya on its recent stance in stemming out malpractices in the banking sector noting that the move will cushion the sector from fraudsters.
The President said in order to further safeguard the interests of investors from emerging fraud in the banking sector it was imperative that the CBK reign in on financial institutions that are evading scrutiny.
In an exclusive interview during his three day visit to Germany, President Kenyatta put on notice rogue local banking institutions that are taking Kenyans for a ride.
The president also noted that the recent move by CBK to place Chase Bank under receivership is a cleanup exercise that will strengthen the country’s financial sector.
He added that the move was aimed at ensuring the interest of depositors are protected from rogue institutions.
On Thursday, Central Bank of Kenya Governor Patrick Njoroge said the decision to place Chase bank under receivership was made after shareholders were unable to provide enough capital injection to keep the bank afloat.
In March this year, chase bank borrowed 5 billion shillings from the African Development Bank to support SMEs lending.
However questions abound as to whether the cash was really given to the SMEs with CBK Governor revealing that insider lending to top directors of up to 7.9 billion shillings was against the law.
On matters trade, the President said Kenya was in negotiations to have the Oil pipeline that is set to be constructed in the northern corridor leveraged in boosting trade in the entire east Africa region.