Customers and creditors of the collapsed Dubai Bank are facing huge loses and a long wait for compensation after the Central Bank of Kenya announced today that it is liquidating the financial institution.
CBK says it has appointed Kenya Deposit Insurance Corporation (KDIC) as liquidator of Dubai Bank Kenya Limited and will work closely with KDIC to facilitate the expeditious liquidation of Dubai Bank Kenya Limited.
“KDIC will release information about the liquidation of Dubai Bank Kenya Limited and payment of depositors in due course,” the CBK said in statement to newsrooms, and urged customers or any persons with claims or inquiries to get in touch with KDIC on Tel No. 0770887992. Customers can also email on kdiccommunications@ depositinsurance.go.ke for more information.
On 14th August 2015, the Central Bank of Kenya (CBK) appointed the Kenya Deposit Insurance Corporation (KDIC) as receiver for Dubai Bank Kenya Limited for a period of 12 months after it failed to meet its financial obligations.
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KDIC today submitted a report to CBK recommending that Dubai Bank Kenya Limited be liquidated after reviewing its operations. “The KDIC report indicates that considering the magnitude of weaknesses of Dubai Bank Kenya Limited, liquidation is the only feasible option,” says CBK.
The Kenya Deposit Insurance Act, 2012 requires CBK to appoint the KDIC as liquidator of a bank, if KDIC as receiver for a bank, recommends that it be liquidated.
Since early 1990s when a number of banks collapsed, 24 have been put under liquidation with seven having already been wound up. Those wound up include Allied Credit Ltd (2007), International Finance Ltd (2007), Diners Finance Company Ltd (2008), Trade Finance Ltd (2008), Nairobi Finance Company Ltd (2010), Central Finance Kenya Ltd (2012 September), Inter African Credit Finance Ltd (2012 September).
Notable banks under liquidation include Trade Bank, Postbank Credit Ltd, Kenya Finance Bank, Euro Bank, Prudential Building Society and Trust Bank—the largest bank failure in Kenya’s history.
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