CENTRAL BANK OF KENYA
Remarks by
PROF. NJUGUNA NDUNG’U
GOVERNOR
CENTRAL BANK OF KENYA
at
A COCKTAIL HOSTED DURING THE SUPERVISORY COLLEGE
MEETINGS FOR KENYA COMMERCIAL BANK, EQUITY BANK AND
DIAMOND TRUST BANK
Hotel InterContinental Nairobi
Friday, 25th October 2013

Chairmen and Board Members of Kenya Commercial Bank
Group, Equity Bank and Diamond Trust Bank;
The Chief Executives of Kenya Commercial Bank Group, Equity
Bank and Diamond Trust Bank;
Heads of Bank Supervision from the EAC Central Banks and
Bank of South Sudan;
Mr. Dirk Jan Grolleman, East AFRITAC’s Bank Supervision
Advisor;
Mr. Mike Andrews, East AFRITAC Consultant;
Distinguished Delegates;
Ladies and Gentlemen:
1. It is with great pleasure that I welcome you to this auspicious
cocktail which marks the end of the Concurrent Supervisory
College Meetings for three significant regional banking groups
- Kenya Commercial Bank, Equity Bank and Diamond Trust
Bank Limited. On behalf of the Central Bank of Kenya (CBK),
I appreciate each one of you for your participation and
contributions during the Supervisory College Meetings. I was
not able to join you for the meetings, however, from the brief
given to me, the meetings were very fruitful and I thank you
all for your valuable participation.

2. Ladies and Gentlemen: The success of the three concurrent
supervisory college meetings attests to the value of team spirit.
The decision to consider concurrent supervisory college
meetings, to optimise on time and other resources, was mooted
during the inaugural supervisory college meeting for Kenya
Commercial Bank in October 2012. In addition to the
concurrent supervisory college meetings, CBK in conjunction
with IMF’s East AFRITAC organised a five day training on
consolidated supervision for technical officers from all the six
participating Central Banks.
It is only when information symmetry on regional banking
groups exists among the regional regulators that effective
supervision of the banking groups can be achieved. That is
why supervisory colleges are necessary for knowledge and
information sharing. To support and complement knowledge
and information sharing, joint capacity building initiatives
are necessary. In this regard, allow me to appreciate IMF’s East
AFRITAC and in particular, Mike Andrews who has
unreservedly continued to impart knowledge to the EAC
Central Bankers on consolidated supervision since 2006. I
challenge the technical officers who have benefitted from East

AFRITAC’s capacity building to start taking over the training
and capacity building efforts as the partnership with East
AFRITAC continues.
3. Ladies and Gentlemen: Supervisory colleges present valuable
forums through which regulators (and the regulated) are able
to compare notes on a continuous basis. The annual
supervisory college meetings are just but part of the forum. The
presence of 6 Central Banks here today reaffirms their
commitment to the spirit of continued coordination and
collaboration. With the continued regional expansion of our
banks, no one regulator can be able to determine with
certainty the compliance status of a banking group. That is
why supervisory colleges are very valuable. Timely sharing of
supervisory information can make a difference in deciding
the relevant supervisory actions to be taken.
With the draft East African Monetary Union (EAMU) Protocol
at its final stages of negotiation, our continued collaboration
is a good stepping stone in readiness for a fully integrated
financial sector for the region.
4. Ladies and Gentlemen: Let me now focus on the commercial
banks present. As we appreciate the important role you play
in mobilising and allocating resources across the region, the

prints of the 2007/2008 global financial crisis are still fresh.
As you expand and innovate, it behoves you to ensure that
adequate risk management is employed. It is with this in
mind that the Central Banks have continuously adapted
international best practices to ensure that financial stability
is maintained.
The outcome of an effective partnership among the regulators
and the regulated cannot be overemphasized. However, such a
partnership should be within agreed boundaries. That is why
I always emphasize the need to build strong partnerships and
institutions. This will guard the rules of the game and avoid
frequent alterations of the rules.
5. Finally, Ladies and Gentlemen, this cocktail presents an
opportunity for you to unwind after three days of rigorous
discussions. It also creates a conducive atmosphere for informal
interactions between the supervisors and representatives of the
banks. Without further ado therefore, I wish you an enjoyable
evening.
Thank you for listening.