The Central Bank of Kenya has handed the management and operations of Imperial Bank Limited under the Kenya Deposit Insurance Corporation (KDIC) for twelve months. Through a statement, CBK says the appointment of KDIC has been carried out “in the interest of its depositors, creditors and members of the public.”
Citing Setion 34 (1 and 2) of the Banking Act, CBK states the act empowers the Bank to intervene in the management of an institution.
“If (CBK) discovers or becomes aware of any fact or circumstance which, in the opinion of the Central Bank, warrants the exercise of the relevant power in the interest of the institution or its depositors or other creditors.”
Although no particular details have been released, CBK states it has become aware of unsafe or unsound business conditions at Imperial Bank necessitating the move for the receivership.
“In light of the above, CBK has appointed the Kenya Deposit Insurance Corporation (KDIC) to assume the management, control and conduct of the affairs and business of the institution and to exervice all the powers of the institution to the exclusion of its Board of Directors and advise CBK of an appropriate resolution strategy as soon as is practicable and not later than twelve months from the date of appointment,” concludes the statement.