Chase Bank re-opens in a week under KCB management

April 20, 2016 11:00 am
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CBK Governor Patrick Njoroge says depositors will be able to access up to Sh1 million and any new deposits will be immediately available thereafter/FILE
CBK Governor Patrick Njoroge says depositors will be able to access up to Sh1 million and any new deposits will be immediately available thereafter/FILE

, NAIROBI, Kenya, Apr 20 – The Central Bank of Kenya (CBK) says Chase Bank will re-open on April 27 under the management of KCB Group Limited.

CBK Governor Patrick Njoroge on Wednesday indicated that depositors will be able to access up to Sh1 million and any new deposits will be immediately available thereafter.

Overview
  • All Chase Bank branches will open by Wednesday, April 27, 2016. The online and mobile banking services will also become available. However, branches may initially offer limited banking services.
  • CBL customers will have immediate access to their deposits up to a maximum of Sh1 million. On this basis, 167,290 accounts (equivalent to 97 percent of accounts or 6 percent of total deposits) will have their funds available in full. Any new deposits will thereafter be immediately available.
  • Deposits in excess of Sh1 million will be made available in a structured manner, details of which will be released in the near future.

He however pointed out that the moratorium on payments to creditors and lenders still remains in place.

“Things are little clearer now than they were say a week ago; I think their patience needs to be acknowledged and their diligence in various ways also needs to be acknowledged,” he said.

Njoroge further stated that both CBK and the new manager will ensure that Chase Bank has adequate liquidity for its operations as KCB works to acquire a majority stake.

“We have confidence in the strength of our banking sector, and the further boosting of confidence that these steps will provide. As has also been indicated, firm action will be taken against those who have abused their fiduciary duties of managing our financial institutions,” he stated.

The CBK Governor said that ongoing efforts to collateralize existing loans and recover funds that were obtained irregularly or are non-performing will be stepped up.

He explained that existing borrowers are still required to continue servicing their facilities.

“CBK and KCB will ensure that Chase Bank Ltd (In Receivership) will have adequate liquidity for its operations. KCB will make available a management team that will assist in the receivership,” he said.

He indicated that KCB will undertake a detailed due diligence review of Chase Bank which will inform decisions relating to KCB’s interest in a majority stake.

“Additional information about this process, including the timeline of an acquisition and the exit from receivership, will be made available in due course. CBK and KDIC are grateful to depositors and creditors for their patience since Chase Bank Ltd was put under receivership,” he stated.

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