President Uhuru Kenyatta has re-appointed Dr. Patrick Njoroge as Central Bank of Kenya Governor for another four year term.
In a special gazette notice, Dr. Njoroge whose tenure was set to end on June 19,2019 will now serve until 2023.
Njoroge was appointed in June 2015 as a replacement for Prof. Njuguna Ndungu on a four-year contract.
The president has similarly re-appointed J. Mohammed Nyaoga as the exchequers board chair person while Sheila M’mbijiwe got her tenure as the deputy governor extended.
The extensions come at a time when the exchequer is embroiled in a controversial demonetization process.
In his first four year term, Njoroge has received praise as well as criticism over his operations at the helm of the Central Bank of Kenya.
Under his reign, the shilling has remained fairly stable at an average of Sh101.97 to the US dollar over the period, when most other African currencies have seen double-digit depreciation.
During, his term the interest cap took root amid resistance from commercial banks who view the cap as being in contravention of best practice. The move saw lenders increase their investments in government securities avoiding small and medium enterprises as well as individuals in efforts geared at minimizing risk.
However, the regulator says banks will start offering loans to small businesses for as little as nine per cent following a High Court decision in March that annulled a law that limits what lenders can charge for credit at no more than 4 percentage points above the prevailing benchmark rate.
Under his stewardship inflation has averaged at 6.2 percent over the period, which falls within the government’s target band of 2.5 to 7.5 percent. Policy makers kept the main lending rate at nine per cent last month for a fifth consecutive meeting on the outlook that inflation would slow, which it did to 5.5 per cent in May.
Njoroge has a few feathers in his cap including his voluntary bank consolidation, to increase banks’ capital requirements fivefold to force tie-ups with now KCB Group Plc buying National Bank of Kenya Ltd while NIC Group Plc and Commercial Bank of Africa Ltd are merging.
In his new term, as CBK governor he faces an uphill task to reign in on the current expansionary fiscal policy that’s raising government borrowing, amid a ballooning wage bill, and an increase public debt.
Currently the budget deficit estimated at 6.1 per cent of gross domestic product in the year ending June,2019.