SBM Bank in adverts carried last week announced separate auctions of several motor vehicles linked to the loan defaults. The bank inherited Sh13 billion dud assets from the fallen banker.
Mauritian lender SBM Bank of Kenya has moved to auction properties and motor vehicles to recover bad debts chalked up under Chase Bank.
SBM in adverts carried last week announced separate auctions of several motor vehicles linked to the loan defaults. The bank inherited Sh13 billion dud assets from the fallen banker.
“We invite offers from interested parties for the purchase of motor vehicles as listed,” said SMB in a notice. “Vehicles are sold on ‘As is where is’ basis.”
Central Bank of Kenya (CBK) governor Patrick Njoroge disclosed last month that half of the Sh26 billion non-performing loans (NPLs) in the banking sector between June and August came from the transaction that saw SBM acquire certain assets and liabilities from Chase Bank.
“As you can imagine, there were specific loans that were non-performing and so they moved over. SBM will endeavour to resuscitate these loans in a particular way,” he said in September.
SBM Bank had not provided additional details on the auction by the time of going to press.
Borrowers of personal loans and small businesses contributed nearly half of the Sh264.6 billion stock of total bad debt held by banks last year, revealing tough times for borrowers hit by economic slowdown.
An annual sector report released by the CBK in August showed personal loan borrowers and traders defaulted on Sh121.4 billion debt in the year, accounting for 45.89 per cent of the industry total.
The situation was also a reflection of businesses that are struggling to stay afloat and others whose operations have ground to a halt following failure by the national and county governments as well as the private sector customers to settle their dues.
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