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KDIC is also yet to appoint a team of restructuring experts to further develop and implement the plan in conjunction with various shareholders/FILE

Kenya

Imperial Bank shareholders’ fury over recovery delay

KDIC is also yet to appoint a team of restructuring experts to further develop and implement the plan in conjunction with various shareholders/FILE

KDIC is also yet to appoint a team of restructuring experts to further develop and implement the plan in conjunction with various shareholders/FILE

NAIROBI, Kenya Nov 25 – Imperial Bank Limited (IBL) shareholders have faulted the Central Bank of Kenya (CBK) and the Kenya Deposit and Insurance Corporation(KDIC) over delays in getting the bank back to business.

The shareholders in a statement say that the further delay will derail the envisaged recovery plan.

According to the shareholders, KDIC is yet to appoint an independent professional firm to undertake a comprehensive due diligence into the affairs of Imperial Bank that would ascertain conclusively the size of the funding gap that will allow the finalization and implementation of any recovery plan.

KDIC is also yet to appoint a team of restructuring experts to further develop and implement the plan in conjunction with various shareholders.

The shareholders have formed a steering committee comprising leading Kenyan banking, legal and finance professionals to guide the reopening process of the bank.

“The shareholders welcome the formation of a depositor group to participate in discussions with the CBK, KDIC and IBL in order to recapitalise and reopen the bank as soon as is possible,” the shareholders said.

CBK handed the management and operations of Imperial Bank Limited under the KDIC for twelve months. KDIC has found substantial fraud at IBL but says the bank is still viable for business.

KDIC revealed that there were fraudulent activities of substantial magnitude, and the misrepresentation of IBL’s financial statements. The fraudulent activities include irregular loans granted by the management and in particular violating the limit on lending to a single borrower.

In particular, the irregular loans were a violation of the statutory limit of lending to a single borrower, and inadequate loan loss provisions, thereby overstating IBL’s capital adequacy position.

IBL Directors were on Saturday grilled by the Banking Fraud Investigation Unit over the fraud claims at the institution.

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