Kenyan Central bank governor to step down in coming weeks
February 18, 2012 / daminaadvisors
The befuddled leadership of Kenya ’s central bank Governor Njuguna Ndungu is likely to come to an end soon as the country’s parliamentary committee charged with examining the country’s recent monetary policy has concluded that Ndungu’s policies are to blame for the recent crash in the value of theKenyan shillingand an ongoing banking sector liquidity crisis.
Kenya’s bank liquidity crisis had seen inter-bank rates shoot up by over 1,250%, from 2% to 28% in the past ten months. While Ndungu, first appointed to the position of governor in 2007 and re-appointed in March 2011, has a mandate until 2014, he is likely to be forced to resign in coming weeks.
Furthermore, President Mwai Kibaki, who appointed Ndungu, could suspend him for up to six months under Section 14 (c) of the CBK Act while the parliamentary committee investigates the actions of the central bank.