Nyakang'o flags huge financial risk as counties operate thousands of unauthorised accounts

County governments are operating over 5,400 bank accounts in commercial banks, many without the required approval from the Controller of Budget (CoB), Margaret Nyakang'o.

In her report for the Financial Year 2024–2025, Nyakang'o highlighted that counties are required to seek approval and register any commercial bank account with her office before opening them. However, many have failed to comply.

“As of June 30, 2025, county governments were running 5,476 accounts with commercial banks,” Nyakango said.

She noted that county treasuries have not submitted authorisation letters for these accounts to her office, as mandated by the Public Finance Management Act. This omission poses a serious risk of financial mismanagement and leaves public funds vulnerable to theft.

Significant disparities

The report revealed significant disparities in account numbers across counties.

Homa Bay leads with 558 accounts, followed by Kitui with 350. Bungoma and Nakuru each operate over 300 accounts, while Baringo maintains 280, Kwale 240, Machakos 231, and Embu 222.

Other counties include Kericho with 245 accounts, Kisumu 190, Nairobi 174, Uasin Gishu 160, Nyandarua 119, Nyamira 157, Elgeyo Marakwet 160, Kirinyaga 140, Trans Nzoia 135, Marsabit 120, and Vihiga 121.

Kiambu operates 75 accounts, Meru 71, Isiolo 68, Busia 57, Kajiado 52, Makueni 45, Nyeri 32, Laikipia 32, Taita Taveta 37, Lamu 37, Mandera 30, Samburu 24, West Pokot 24, Garissa 26, and Turkana 26.

Smaller numbers were reported for Tharaka Nithi and Tana River (16 each), Siaya 15, Murang’a 20, and Nandi 10, highlighting wide disparities across the country. Figures for Kilifi and Narok counties were not disclosed.

Nyakang'o warned that the proliferation of multiple commercial bank accounts, especially without required approvals, leaves public funds highly vulnerable.

PFM regulations

Her report cited Regulation 82(1)(b) of the Public Finance Management (County Governments) Regulations, 2015, which mandates that county government bank accounts should be opened and maintained at the Central Bank of Kenya, except for accounts used for imprest, petty cash, and revenue collection.

Regulation 82(4) requires county accounting officers to obtain written authorisation from the County Treasury before opening a commercial bank account, while Regulation 82(5) obliges the County Treasury to submit copies of the authorisation letters to the Controller of Budget.

Despite these regulations, many counties continue to operate numerous commercial bank accounts without submitting the required letters, highlighting persistent gaps in compliance with financial management laws.

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The report also assessed counties’ performance in development fund absorption and revenue collection.

Governors Stephen Sang of Nandi, George Natembeya of Trans Nzoia, Patrick ole Ntutu of Narok, and Isaac Mutuma of Meru were credited with the highest absorption of development funds.

Kisii Governor Simba Arati led in own-source revenue collection, alongside Tana River, Wajir, and Kirinyaga counties.

Nairobi Governor Johnson Sakaja topped overall revenue collection with Sh13.1 billion, achieving 66 per cent of the target, followed by Narok’s Patrick ole Ntutu with Sh5.7 billion, with Mombasa and Kiambu rounding off the top collectors.

Meanwhile, Kajiado, Machakos, Isiolo, and Taita Taveta underperformed in own-source revenue collection.