KCB takes over five Imperial Bank branches in final offer

KCB will now take over five Imperial Bank Limited in Receivership (IBLIR) branches in its final bidding offer for the collapsed lender.

The final offer announced on Friday by the Central Bank of Kenya and the Kenya Deposit Insurance Corporation will also see the recovery of another 19.7% of deposits owed to Imperial Bank customers to bring the total recovery to an approximate 54.7% following the release of 35 percent of funds in December 2018.

In a joint press statement, CBK and KDIC said that they assessed the deal as a viable proposal to the further resolution of Imperial Bank Limited in Receivership for the benefit of depositors and the strengthening of the Kenyan financial sector.

“CBK and KDIC reiterate their commitment to protect the interest of depositors, creditors, and the wider public interest. This is in keeping with their respective mandates and in accordance with the Laws of Kenya,” the pair noted.

The outstanding balances to Imperial bank depositors in the final offer will be released in three tranches with 12.5% of funds being released upon the signing of the final binding offer.

A further 12.5% will be paid out on the first anniversary of the signing and 25% each on the consequent anniversaries to the fourth year.

An approximate 92% of eligible depositors had from December 2018 been granted full access to their balances through KCB and Diamond Trust Bank upon the confirmation of claims.

The announced recovery will not however include the realization of an approximate Ksh.36 billion, funds linked to ongoing legal action.

Imperial Bank went under in October 2015 and CBK placed it under the management and control of the KDIC over what it termed as unsound business practices.

The troubled bank had a total of 27 branches across the country by the time of summoning.

Both the CBK and the KDIC remain in engaged with other lenders to verify and consider the uptake of the remaining loan assets to aid in recovery efforts while exploring options for the lender’s remaining staffers and 22 branches.

KCB had initiated the partly acquisition offer of IBLIR assets in an expression of interest process announced in October 13,2017.