CBK governor Njuguna Ndung’u survives arrest order and reports back to work

Prof Njuguna Ndung’u resumed his duties at the Central Bank on Monday following a decision by the High Court last week to halt his arrest on allegations of corruption in a procurement deal.

Speaking to the Daily Nation over the phone on Monday, Central Bank of Kenya (CBK) media relations officer, Ms Nancy Sang, said the governor had reported to office on Monday.

“He is in office today,” she said.

On Friday last week, Justice David Majanja halted Prof Ndung’u’s arrest over charges of abuse of office pending a hearing that has been set for March 12. (READ: Central Bank boss gets court orders barring arrest)

The allegations arise from the manner in which a Sh1.2 billion tender to install security software at the Central Bank was awarded to Horsebridge Networks Systems East Africa Limited. (READ: Ndung’u defends himself in Sh1bn corruption claim)

This claim is only the latest controversy to chip away at the governor’s image since he assumed his post having survived several attempts to unseat him.

RENEWED HIS TERM

Prof Ndung’u was in 2007 plucked from the Africa Economic Research Consortium by Kibaki’s government to head the Central Bank of Kenya (CBK).

Four years later, even as former President Kibaki renewed his term at the CBK, there were voices that questioned his ability to steer the regulator after his reputation was tainted by a scandal involving the sale of the Grand Regency Hotel (now Laico Regency).

A 2008 commission convened to investigate the hotel, previously owned by Kamlesh Pattni, concluded that the Central Bank could have realised better value for the sale of the facility.

Further, the deal was termed as a “flawed process.” For many in the civil society, these allegations affected the governor’s integrity and his ability to lead the bank.

A 2012 report prepared by legislators on the unprecedented decline of the Shilling in 2011 recommended that Prof Ndung’u vacate office pending investigations into his competence as a governor. However, MPs later voted to expunge the recommendations on Prof Ndung’u from the report.

In a separate 2012 inquest, parliament’s Public Accounts Committee recommended that the governor, along with former Transport minister Amos Kimunya, be investigated over a controversial currency printing contract with UK firm De La Rue. The report also proposed that the two be barred from holding public office. They survived the onslaught after the report was rejected.

NURTURED GROWTH

Despite these upheavals, Prof Ndung’u’s tenure at the Central Bank has seen the adoption of a regulatory regime that has nurtured the growth of financial service innovations such as mobile money and agency banking.

Prof Ndung’u has also been credited with helping restore the confidence of the Bretton Woods Institutions in CBK through his steering of the country’s monetary policy.