Imperial Bank depositors protest delay to give them access to their money. KCB Bank has made a final offer in its bid to buy the troubled lender that is currently in receivership.

KCB Bank has submitted a Final Offer to the Central Bank of Kenya and Kenya Depositors Insurance Corporation (KDIC) as it gears up to buy Imperial Bank Ltd, which is presently in liquidation.

CBK and KDIC had in December last year announced a release of funds increasing total recovery to approximately 35% of original eligible deposits held at the time of receivership. Funds were previously made available in three tranches, and approximately 92% of eligible depositors had been granted full access to their funds.

In letters dated March 29 and April 2, 2019, KCB communicated to CBK and KDIC a modification of terms of the Binding Offer with regard to the completion of the verification of loans process.

“CBK and KDIC assess that KCB’s Binding Offer represents a viable proposal for the further resolution of IBLR for the benefit of depositors and the strengthening of the Kenyan financial sector. It is expected that the transaction will be completed expeditiously,” a joint statement by CBK and KDIC on Friday stated.

According to the joint statement, the accepted final offer includes a further recovery of 19.7% of eligible depositor balances remaining at IBLR.

It said the remaining balances due to eligible depositors will be released in three tranches: 12.5% on completion of the signing of the agreement; 12.5% on the first anniversary of the signing; and [email protected] on the second, third and fourth anniversaries respectively.

Interest rates payable on deposits balances will be in line with existing deposit products.

According to CBK and KDIC, this recovery does not include the realisation of approximately Ksh 36 billion of loans, translating to 50% of current loans balances, linked on ongoing litigation, and which they continue to pursue for the benefit of depositors and creditors.

“CBK and KDIC will be working closely with other banks to verify and consider uptake of the remaining loan assets to enhance further recovery,” said the statement.

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As part of the Final Offer, KCB has confirmed that it will take over five branches of IBLR as CBK and KDIC continue to explore options for the remaining staff and branches.

Before it was weighed down by insider lending and unorthodox management style, Imperial Bank boasted of 27 branches located mainly in Nairobi and the Coastal region and a staff complement of approximately 600 employees.

 

 

 

 

 

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