CBK rules on bank CEO tenure meet global standards, analysts say

Analysts have welcomed the proposals by Central Bank of Kenya governor Dr Patrick Njoroge to cap the tenure of commercial bank bosses saying it’s in tandem with international best practices.

The Central Bank of Kenya (CBK) plans to introduce regulations that will limit how long a CEO can be in office as it seeks to enhance corporate governance.

Standard investment bank head of research Francis Mwangi said the collapse of three banks within a year has brought to the fore challenges, with tighter regulations expected to restore confidence.

“If corporate governance is in place and in place the right way and investors and the general public believe it’s being enforced in the right way then the overall benefit is the confidence,” Mr Mwangi said.

Long serving bank CEOs in Kenya include James Mwangi at Equity, Gideon Muriuki at Co-operative bank as well as DTB’s Nasim Devji.

Mr Mwangi adds the banking regulator also needs to step up its supervisory on banks to arrest challenges early.