Outgoing Kenya Commercial Bank (KCB) Chief Executive Officer Joshua Oigara is poised to join Kenya Kwanza Coalition’s think tank strategy team led by Deputy President William Ruto, The Informer has established.
According to reliable sources within the coalition, Oigara is being touted as a possible candidate for the post of Central Bank of Kenya (CBK) governor should Ruto’s coalition win to succeed the incumbent Patrick Njoroge.
Oigara’s departure at the bank comes months shy to the end of his controversial one-year extension in office by the board due in December this year.
According to impeccable sources, Oigara is set to join the inner cog of DP Ruto’s led coalition.
However, when contacted for comment, Oigara did not respond to our calls and short text messages by the time of going to publication.
He, among others will be tasked craft a national economic strategy in support of the ‘bottom-up’ economic model championed by the Ruto’s team.
“Yes Oigara has been supportive of this team. However, it is not clear whether he will continue offer support from the periphery or actively join the team.” Our source intimated.
Before extension of his stay at the helm of the bank, there was growing friction within higher ranks of KCB leadership hierarchy on whether to extend his term after the lapse of his two four year terms.
The Board of Directors were split secretly extended Joshua Oigara’s tenure by a year amid a litany of integrity issues bedeviling the embattled Chief Executive Officer.
Oigara has been at the helm of the government-owned bank for nine years.
The tenth year extension will lapse on December 31, this year.
Under his tenure, KCB facilitated issuance of Sh1.2 billion loan facility to Weston Hotel owned by Deputy President William Ruto which is said to be sitting on government-owned land.
Oigara’s name prominently featured in the Kencon Sacco’s scam revealing through an internal audit involving Sh43 million contract to construct access road for sacco’s housing project in Runda.
The matter is still under active investigation by the Directorate of Criminal Investigations (DCI) at Mazingira House.
Five years ago, in what marks one of the key controversial highlights of Oigara’s tenure, KCB barred from using a core banking software over IP infringement and software piracy. This is after Nagalakshmi Solutions Ltd (NLS) sued the bank for continuing to use the software which powers its withdrawals and cash deposits.
Nagalakshmi Solutions Ltd (NLS) said KCB continued to use the software even after they terminated the deal in November 2016.
High Court Judge, Judge Fred Ochieng ordered the bank to uninstall the software immediately until the case was heard.
The bank, in court documents, says the contract agreement signed by NLS has an arbitration provision that must be used and that the court lacks jurisdiction to settle the row.
But NLS has asked the court to throw out KCB’s arbitration push, arguing the bank is misrepresenting facts because the agreement did restrict the parties to a non- court settlement in the event of a dispute.
“The clause (arbitration) is operationalised by the word ‘may’ wherein either party may elect arbitration as a medium of dispute resolution,” says NLS.
“Accordingly the word ‘may’ does not make it imperative that disputes should be referred to arbitration as alluded to by the defendant.”
NLS wants KCB, Kenya’s largest bank by assets, to uninstall the software that works together with its core banking application and be barred from developing a similar IT application.
This potentially threatened to cripple banking operations such as withdrawals, cash and cheque deposits since the software at the centre of dispute works like a backup to the core banking application.
Mediation efforts fronted by KCB and NLS lawyers, Muriu, Mungai & Company Advocates and PLO Lumumba respectively, started in November, but have failed to break the deadlock.
NLS cancelled the contract in November after failing to agree on payment and suspecting that KCB was replicating its products and offering negative references issued to rival firms, court documents show.
The documents show that KCB has continued to use the software without NLS permission, leading to a daily claim of Sh2million or Sh268million for the 134 days the lender has used the software since termination of the agreement.
“The notice of termination lapsed on November 27, however, the plaintiff has continued to use the software in breach of the agreement of March 2011 and plaintiff’s intellectual property rights,” says NLS.
NLS told the court that it incurred “huge losses from the loss of business and fraudulent use of its software” by KCB, and argued that it would suffer “irreparable loss” if an injunction stopping the bank is not issued.
It is demanding a further $51.6 million (Sh5.2 billion) in lost business after KCB, its first major client, allegedly offered unfavourable referrals to other banks, leading to cancellation of deals.
Arbitration is a private, faster and less expensive way of resolving disputes than going to trial.
In an arbitration, the case is heard by an arbitrator mutually agreed upon by the two sides.
The arbitrator has the sole authority to make a ruling, and normally, the arbitrator’s decision cannot be appealed.
In 2018, the bank re-appointed Oigara for a four-year term which was to end last year.
He was first appointed to the position in January 2013.
During his tenure, Oigara has steered the bank to greater heights and extended its foothold neighbouring Uganda, Tanzania, Rwanda, Burundi and South Sudan.
Last year, the bank posted a growth of 131 per cent in net profits to Sh25.2 billion in the first nine months of 2021, following a significant reduction in bad loans.
The 1975 born Oigara holds a Bachelor’s degree in Business Administration and a Master’s degree in Business Administration in Strategic Management and Investments from Edith Cowan University in Australia, was born in 1975.
KCB has already finalised the acquisition of National Bank of Kenya (NBK).
He will be replaced by Paul Russo.
Russo is the current Managing Director of NBK and previously worked for Barclays Bank, PriceWaterhouseCoopers (PWC), K-Rep Bank and Unga Limited.