Happy day for customers as Chase Bank reopens

The three weeks wait is over for Chase Bank customers as the bank opens its doors this morning.

The bank was placed under receivership on April 7, and now holds the record for the fastest bank to bounce back from receivership.

This is partly due to a reopening plan proposed by the Kenya Commercial Bank Group and adopted by the Central Bank of Kenya (CBK) last week that offered a speedy resolution to the bank’s woes.

KCB will take over management of the bank for the receivership period working closely with the Kenya Deposit Insurance Corporation (KDIC). The bank will open with minimum operations but small depositors will be able to access up to Sh1 million of their funds in the bank.

While there have been fears that the bank could face a liquidity challenge due to mass withdrawals, the central bank has said a special facility has been created to provide support to the bank.

“While Chase Bank limited (In Receivership) has resumed operations with effect from April 27, 2016, minimum operations of the bank will be undertaken during the receivership period,” KCB said in a notice to customers.

Deposit accounts are defined as savings, current and fixed deposit receipt accounts.

KCB on Monday announced that it was still structuring a repayment plan for large depositors, who would be able to access their funds in the next 90 days. KCB is set to charge a management fee as it steers the reopening, and has already deployed a team of at least seven senior managers to Chase Bank.

The fate of senior managers at Chase Bank is still unclear and whether they will play a role in the revival process. KCB however announced that all employees would resume duty and would even receive their April pay in full.

“We recognize the fact that our customers have been regrettably inconvenienced over the last two weeks. Chase Bank will continue to maintain the same operating hours and give even better banking experience,” Chase Bank management said in a notice in the dailies.

167,290 account holders qualify for the withdrawal limit. The CBK last week revealed that the group that represents 97 percent of all accounts at the bank only account for six percent of total deposits.

KCB has been given a shoe in by the banking regulator to take up a majority stake in the bank as part of the agreement signed last week.

Chase Bank was placed under receivership after a run on deposits left the bank facing liquidity challenges.

latest stories