Mar 20, 2014

SFAE students should contribute to the Financial Sector, says Rotich

Dr. Geoffrey Mwau

Wednesday March 19th marked a great milestone for Strathmore’s School of Finance & Applied Economics (SFAE). The School organised a farewell dinner to mark completion of the course by its pioneer students since the launch of the School in 2010. It was a high profile event graced by many industry professionals, among them, the Economic Secretary of the National Treasury Dr. Geoffrey Mwau, as a representative of the chief guest Cabinet Secretary, National Treasury Mr. Henry Rotich, who unfortunately could not attend the dinner event.


The dinner event was a good occasion to celebrate after 4 years of hard work, as well as to give guidance to the students on how to navigate the world of work.

The Cabinet Secretary’s speech delivered by Dr. Geoffrey Mwau follows:


Ladies and Gentlemen

Congratulations to Strathmore University, School of Finance and Applied Economics for its achievements over the last four years. Congratulations to the seventy pioneer students for making it to the fourth year of study. We look forward to your graduating and joining us in contributing to achievement of Vision 2030.

That Vision identifies financial services as a key economic pillar with a target “to create a vibrant and globally competitive financial sector that will promote high level of savings to finance Kenya’s overall investment needs”.

Financial sector has been a key driver of growth with financial intermediation growing at 7.8percent and 6.5percent respectively in 2011 and 2012 well above the overall GDP growth rate of 4.4percent and 4.6 percent in those two years. The Global Competitiveness Index (CGI) 2013 – 2014 by the World Economic Forum ranks Kenya number 96 out of 148 overall in terms of competitiveness. However, Kenya is ranked most favorably in the area of financial market development with GCI position 1 in the world for “legal rights”, position 35 for “financing through the local equity market”, position 44 for “ease of access to loans” and position 55 for “regulation of securities exchange”.

Kenya, also scored well on its innovative capacity and is ranked at position 46 buoyed by high company spending on research and development and good scientific research institutions, including Strathmore University, which collaborate well with the business sector in research activities. Kenya has made remarkable progress in increasing access to financial services. According to the Financial Access 2013 survey report, the proportion of the adult population using different forms of formal financial services stood at 66.7percent in 2013 compared to 41.3percent in 209 and only 27.4 percent in 2006. Government of Kenya has put in place a Financial Services Sector Plan for the coming years in order to build on this good performance of the financial sector and lift it to a higher level.

The objective is improving efficiency, enhancing stability, further increasing access and strategizing Kenya as a regional financial hub. In the area of Efficiency we are moving to operationalize the Nairobi International Financial Centre whose design is founded on the city of London model. Once fully operational the center will consolidate our position as a regional hub that will facilitate world class financial services. It will also serve to provide financial services to the rapidly developing Oil and Mineral sector in Kenya and the broader East and Central African region.

I have recently gazette Credit Reference bureau Regulations which enable sharing of positive information about borrowers by financial institutions. We are also streamlining the National Payment Systems and this week I will be gazetting regulation under the National Payments Act to this end.

I will also soon be announcing additional new measures to address the issue of the high cost of credit in the country and the high level of concern with regard to high interest rate spreads. In the area Stability, we are forming the architecture of the financial sector regulation through ongoing consolidation of the financial sector regulators into a Financial Services Council.

We intent to merge the development finance institutions into one Kenya Development Bank which will be a stronger institution able to provide long term credit to the private sector for capital and infrastructure development.

In the area of Access; Notwithstanding the significant recent achievements, we shall seek to put in place a national strategy for financial education and a comprehensive financial sector consumer protection framework to build on these gains and encourage even greater use of formal financial services.

Regionally, we are working with the other partner states in the East African Community in harmonizing the legal and regulatory frameworks for the financial sector in line with international standards. We have already drawn a road map towards the East African Monetary Union (EAMU) and shall begin implementation once the EAMU protocol is ratified by all the partner states in the coming months. To support the reforms in the financial sector we shall continue to maintain macroeconomic stability.

Inflation is the biggest enemy of savings in the financial sector and we shall therefore ensure monetary and fiscal policies are geared towards low inflation as well as stable exchange rates and higher macroeconomic growth. In addition, as I recently outlined in my Budget Policy Statement that I forwarded to the National Assembly we have prioritized five areas for the broader economy namely:


(i) Creating a conducive investment climate, including security;

(ii) Investing in agricultural transformation and food security;

(iii) Scaling up investment in transport, logistics, affordable energy and water;

(iv) Further expanding access and quality of education, health care and social protection; and

(v) Entrenching devolution to ensure efficiency in service delivery and promote local economic development

It is our expectation that many of the graduates from the Strathmore University, School of Finance and Applied Economics will join the financial sector and other priority sectors and contribute towards our objective of Economic Transformation for Shared Prosperity.

The School is grateful to the following who graced the dinner, David Owino - CEO, Ascent Capital; Einstein Kihanda – Chief Investment Officer, ICEA Lion group; Ezekiel Macharia - Head of Actuarial Dept. Jubilee Insurance; Gabriel Ndengele – Risk management, I&M bank; Jayne Ng'ethe - HR, De La Rue; John Randa - Senior Economist, World Bank; Kenas Otieno – Head of Risk Management, I&M Bank; Naomi May Mwangi - Executive Director, Personnel Management, Strathmore University; Paul Ochieng - Dean of Students, Strathmore University; Salome Mukuna - HR, Britam and Stella Njoroge – HR Director, Strathmore Business School.


Below are some of the photos taken during the dinner:





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