Central Bank (CBK) Governor Patrick Njoroge maintained the controversial banking law as was could not be implemented as it would be akin to relaxing money laundering and terrorism laws.
The governor is against the banking regulations on customer deposits and withdrawals because he believes MPs will tamper with them to allow huge capital withdrawals that he fears will fan money laundering and the financing of terrorism. He also warned that doing so would frustrate the war against corruption and cut off Kenya’s banking sector from the best practices in the global banking system like Financial Action Task Force (FATF).
The CBK boss was appointed in June 2015 for a renewable term of four years. Though the President has the powers to renew his second term without the input of MPs, they vowed to make his reappointment difficult unless he complies with the law.
The Finance Act mandates the CBK boss to publish the regulations and submit them to the National Assembly within 30 days of its coming into force, for consideration in line with the Statutory Instruments Act.
What infuriates MPs, however, is that more than six months down the line, Dr Njoroge is yet to comply with the law.
He has instead issued guidelines in form of memos and circulars to the banking industry, which MPs have dismissed as illegal.
MPs led by majority leader Aden Duale and Suna East’s Junet Mohamed complained about Dr Njoroge’s exigencies, saying his issuing of circulars and memos was against the Finance Act, which sets a timeframe for the publication of the regulations.