Senior government officials from Kenya’s financial sector travelled halfway around the world to B.C. to learn the art of regulating credit unions, in the hopes of strengthening one of the most important aspects of the Kenyan economy.
“Some of the strongest credit unions in the world,” are here in Canada, said Mr. Carilus Ademba, the chief executive officer of the semi-autonomous Kenyan agency (SASRA) that regulates credit unions – or SACCOs, as they are called in Kenya.
Credit unions are an important part of the B.C. economy. According to a March, 2012, report by Credit Union Central of Canada, the two largest credit unions outside of Quebec are B.C.-based: Vancity and Coast Capital Savings. Consequently, Mr. Ademba said, visiting British Columbia made sense.
Mr. Ademba was accompanied by four other government officials, including members of the Central Bank. They arrived in Vancouver on Jan. 27 and will fly back to Kenya on Feb. 2.
The delegation’s trip includes a three-day agenda organized by B.C.’s Financial Institutions Commission (FICOM), which regulates the province’s credit unions among other financial agencies. Mr. Ademba and his team will also have the chance to meet with credit unions such as Vancity.
One of the delegates, Mr. Fannuel Odhiambo, said that Kenya “borrowed quite a bit from Canada” when the act establishing SASRA was written, so it was only natural to travel to Canada to learn more.
More than 4,000,000 Kenyans are members of credit unions, Mr. Ademba said, noting that SACCOs affect practically every aspect of the economy, including farming, dairy and transportation. Since Kenya is an important financial power in Africa, shoring up credit unions is critical.
“In the East African region … Kenya is the hub in terms of financial services,” Mr. Ademba said. “Therefore, we need to build up more confidence in the financial sector.
Carolyn Rogers, FICOM’s chief executive officer, noted that SASRA is still in its nascent stages.
SASRA was “formed in 2008, and they are looking for leading practices in [regulating] financial co-operatives,” Ms. Rogers said. “They looked at the framework that B.C. is using and wanted to learn more.”
SARSA oversees about 216 credit unions that hold about $3-billion (Cdn.) in total assets. Further, Ms. Rogers added, “SACCOs serve primarily the low-income sector in Kenya and therefore serves an important social role as well as a financial role in the Kenyan economy.”
Mr. Ademba said that he and his team have benefited specifically from learning about B.C.’s risk-based regulation.
“You cannot specifically supervise on a day-to-day basis what happens in the all the sectors,” he said, therefore you have to develop a system for assessing risks, which B.C. has done successfully for the last 10 years.
Although credit unions brought the Kenya delegation to Canada, Mr. Ademba and his team could not help mentioning how much they want to enjoy some tourist activities, including visiting Vancouver Island and the mountains.
“Hopefully one or two of us should be able to try skiing,” Mr. Ademba said. “We made sure we took insurance. If I break my legs at least I’ll be taken care of.”