CBK to meet Imperial Bank depositors ahead of KCB deal

Business Reporter

Nation Media Group

What you need to know:

CBK and KDIC said in a joint statement on Wednesday that they have received an improved binding offer from KCB, inching closer to concluding a deal that will see the bank carve out certain assets and liabilities from Imperial Bank.
In July, the two institutions said that only KCB had submitted a revised proposal to buy Imperial Bank which went into receivership on October 13, 2015.
KCB’s initial offer had been rejected with CBK asking it to improve it in order to maximise value for depositors.

The Central Bank of Kenya (CBK) and Kenya Deposit Insurance Corporation (KDIC) will hold a meeting “soon” with depositors of Imperial Bank, which is under-receivership, as it finalizes the assessment of revised offer from Kenya Commercial Bank #ticker:KCB .

CBK and KDIC said in a joint statement on Wednesday that they have received an improved binding offer from KCB, inching closer to concluding a deal that will see the bank carve out certain assets and liabilities from Imperial Bank.

“CBK and KDIC will provide further details to stakeholders as soon as the binding offer has been fully assessed. In particular, a meeting with depositors will be called shortly,” they said in a statement.

In July, the two institutions said that only KCB had submitted a revised proposal to buy Imperial Bank which went into receivership on October 13, 2015. KCB’s initial offer had been rejected with CBK asking it to improve it in order to maximise value for depositors.

Two weeks ago, CBK governor Patrick Njoroge said that progress has been made, adding that he did not expect the ongoing Imperial Bank case implicating deputy chief justice Philomena Mwilu to complicate the deal.

“It is an offer that is similar to that of Chase Bank and SBM Bank. It has nothing to do with what is being contested in court,” Dr Njoroge said.

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Last week, High Court allowed Imperial Bank to continue being under receivership pending the hearing of a civil case involving CBK, KDIC, and Kenya Tea Development Agency Limited. The case will be mentioned on January 15, 2019.

“CBK and KDIC expect that this Order provides sufficient time to conclude the matter of KCB’s binding offer,” the two institutions said.

Imperial Bank held Sh58 billion in customer deposits at the end of June 2015 and was classified as a mid-tier lender with operations in Kenya and Uganda. It had 52,398 deposit accounts at the end of 2014.