Fourteen governors have said they will acquire an existing bank under the Lake Region Economic Bloc (LREB) to propel their development agenda.
Wycliffe Oparanya, LREB chairman and Governor Kakamega County said ex KCB Group CEO Martin Oduor has been asked to help find a potential bank for the bloc’s project worth Sh2.8 billion.
“We have decided to buy an existing bank instead of establishing a new one, which will take time. […] We want a smaller bank where we have a controlling share,” Oparanya said at Lesavanna Hotel in Kisumu.
Governor Oparanya said the project is at an advanced stage and have discussed the matter over with the Controller of budget, the governor of the Central Bank, and the Auditor General.
“It is an issue we have had [widely consulted on] and are optimistic that it will not fail,” he said adding that they chose to acquire an existing bank to prevent delay in kickstarting operations.
He further said the bloc has developed a legal framework supported by a resolution of the 14 county assemblies and which will sustain the bloc even after the current governors’ term ends.
“We have a binding agreement signed by 14 governors to guide [the] formation of LREB. Our bank will just be like any other bank but have a bias in terms of lending to this region but it will have its headquarters in Nairobi,” said Mr Oparanya.
The counties that form the Lake Region Economic Bloc include Vihiga, Bomet, Kakamega, Trans Nzoia, Nyamira, Kisumu, Homa Bay, Kericho, Siaya, Migori, Busia, Bungoma, Nandi, and Kisii.
“We agreed that each county will contribute Sh200 million. We expect to raise Sh2.8 billion by end of next year,” Governor Oparanya said.
“Homa Bay County assembly has approved Sh50 million in their supplementary budget for this endeavour and we hope other counties too will follow suit. So far we have Sh100 million in the account contributed by Kisumu County.”
The LREB chairman said the governors will meet with county assembly leaders to discuss the project and their role in making the project a success.
“As soon as the counties agree through adopting the legal instrument in their assemblies, then their resolution will bind all the 14 to enable [us to] kick off the project.