Companies

CBK revokes Chase Bank licence, kick starts winding up

cbk

Central Bank of Kenya building in Nairobi. FILE photo | nmg

alushula

Summary

  • The Central Bank of Kenya (CBK) has formally cancelled the Chase Bank licence and paved the way for its liquidation, bringing to an end the existence of a lender that joined the industry on April 1, 1996.
  • The regulator has also formally appointed Kenya Deposit Insurance Corporation (KDIC) to oversee the liquidation of the bank, which was put under receivership four years ago due to failure to meet its financial obligations.

The Central Bank of Kenya (CBK) has formally cancelled the Chase Bank licence and paved the way for its liquidation, bringing to an end the existence of a lender that joined the industry on April 1, 1996.

The regulator has also formally appointed Kenya Deposit Insurance Corporation (KDIC) to oversee the liquidation of the bank, which was put under receivership four years ago due to failure to meet its financial obligations.

“It is notified for the information of the general public that in exercise of the powers conferred by section 6 (1) (a) of the Banking Act, the CBK has revoked the licence of Chase Bank Limited with immediate effect,” said CBK governor Patrick Njoroge in a special gazette notice.

The regulator last Friday instructed the KDIC to start the liquidation of Chase Bank’s remaining assets to salvage some money for customers who had more than Sh100,000 each in the bank.

The agency said yesterday it would issue information about the liquidation process and payment of depositors “in due course” even as it reached out to depositors seeking any clarification to come forward.

KDIC chief executive Mahmoud Mohamed said the depositors of Chase Bank in liquidation would be the first beneficiaries of the enhanced insured deposit amount of Sh500,000.

“We managed to salvage 75 per cent of the assets through the SBM Bank deal. So the remaining 25 per cent is the one we are going to pay the Sh500,000 [per depositor] from,” he said.