Chase Bank customers to access loans, funds transfer

Chase Bank customers will be able to access loans and funds transfer services starting Tuesday, KCB Group chief executive Joshua Oigara has said.

The resumption of the two service means that all Chase Bank products will be accessible by mid this week, Mr Oigara Mr Oigara said Monday in an interview.

“Cheques have been cleared by the Kenya Bankers Association and will begin running from Wednesday. And then during the month we need to look at the loans for small medium enterprises (SMEs). There were facilities which were there, we need to find a way to get them back running. All other services are available,” said Mr Oigara.

Chase Bank’s 57 branches re-opened last Wednesday under the management of KCB, working with Kenya Deposit Insurance Corporation.

The regulator on April 7 placed Chase under receivership owing to liquidity problems created by a run on the mid-sized lender from panicked depositors.

The mid-sized lender’s banking halls opened on Wednesday 9am with services such as mobile banking app Mfukoni, online banking, ATM services and debit card transactions going live.

READ: Relief as Chase Bank reopens with mixed fortunes for savers

Key services such as electronic funds transfer, credit cards, loan applications, overdraft, forex trading, foreign currency accounts, issuance of letters of credit and guarantees, however, had remained unavailable.

Mr Oigara said KCB was exploring modalities to have the larger depositors access their money “as soon as possible.”

“We are looking at the month of May. I already met a number of the large depositors last week. By mid of May we will be able to have a better timetable on when they can access their money. This remains my biggest priority,” said Mr Oigara on phone.

Withdrawals had been capped at Sh1 million of deposits, following the reopening, meaning that only 167,290 account holders (equivalent to 97 per cent) of total depositors have full access to their savings.

Targeted withdrawals

Those with deposits exceeding Sh1 million would receive their money “in a structured manner” in future, the Central Bank of Kenya (CBK) had earlier said.

According to Mr Oigara, Chase Bank depositors drew Sh1.1 billion on the first day of re-opening against an expected target of Sh5 billion by the bank’s receiver-manager.

About Sh100 million was deposited in the bank on the same day it reopened its doors.

“Initially we had targeted that the withdrawals (over the counter) in the first day were going to be Sh5 billion. We had closer to Sh1 billion…we also saw there were Sh100 million deposits and opening of accounts…,” said Mr Oigara.

He said the lender’s mobile platforms had also recorded ‘fewer than expected withdrawals.’

My Oigara remained cagey about KCB’s intended takeover of Chase Bank.

“If we do end there (takeover) it will be exciting for us. And it will be not be a merger. Chase will end up running as an independent business with its niche of SME, Islamic banking which runs well. We are not going to run one single organisation on one platform. It (Chase) may remain pink (Chase’s corporate colours) and we (KCB) remain green, (KCB’s corporate colours) but part of the same brand.”

He declined to comment on the fee KCB is earning for its receiver-manager role.

The CBK Governor Patrick Njoroge in an earlier statement said that KCB plans to buy a controlling stake in Chase Bank, but details of the transaction remain scanty.

“KCB will undertake a detailed due diligence review of Chase Bank. This will inform decisions relating to KCB’s interest in a majority stake,” said Mr Njoroge.