Depositors in a dozen savings and credit co-operative societies, including giants such as Moi University Sacco and Telepost Sacco, can now breathe a sigh of relief after the regulator renewed their licences, which had expired in June.
Sacco Societies Regulatory Authority (Sasra) said it had extended the permits for all the 12 credit unions to December saying the saccos had “made efforts” to comply with capital adequacy and corporate governance rules.
Their provisional licences had expired between June and July, leaving about 70,000 members on edge as their saccos’ operating permits could either be extended or revoked.
The dozen credit unions jointly hold Sh5.71 billion in assets, Sh3.23 billion in member deposits, and a loan book of Sh3.55 billion as at December 2015, according to official data from Sasra.
“Their licences have been extended to the end of the year.
“They have shown great improvement to comply with regulatory requirements,” Sasra chief executive John Mwaka told the Business Daily.
The list of deposit-taking saccos granted the reprieve include CMC Holdings’ Comoco Sacco, Nitunze Sacco, previously known as Mumias Outgrowers Sacco, Rachuonyo Teachers Sacco, and Akamba Handicrafts’ Uchongaji Sacco.
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Also in the list of societies whose expired interim permits were extended are Nandi Hekima Sacco, Mombasa-based Jitegemee Sacco, Bomet-based Kenya Midland Sacco, Neco Sacco of Nanyuki, and Orient Sacco (formerly Thika District Teachers Sacco).
Sasra regulations require deposit-taking credit unions to maintain a minimum 15 per cent liquidity ratio, and are compelled to file a report at the end of every month detailing the liquid assets as well as the balance of short term liabilities.
Saccos are also required to maintain a core capital of not less than Sh10 million, maintain a core capital to total assets ratio of 10 per cent, and core capital to deposit as well as institutional capital to total assets at eight per cent each.
The rules require deposit-taking saccos to have an elected board of directors, constitute board committees, separate the oversight roles of the board and management, and publish audited results annually.