NAIROBI, Kenya, Dec 9 – The Central Bank of Kenya (CBK) has approved the liquidation of the Imperial Bank.
CBK had ordered the privately owned bank to be put into receivership in October 2015 after the board of the mid-sized lender alerted it to suspected malpractice.
The approval follows the submission of a Receivership Report by Kenya Deposit Insurance Corporation(KDIC) to CBK recommending that Imperial Bank Limited (IBLIR) be liquidated.
“The report indicates that considering the weak status of IBLIR’s financial position, liquidation is the only feasible option,” CBK said in a statement.
The appointment of KDIC as a receiver for Imperial Bank Limited was done by CBK in the interest of the bank’s depositors, creditors and members of the public.
On June 2, 2020, KCB Bank Kenya (KCB) acquired certain assets valued at Sh3.2 billion and assumed liabilities of the same value following an expression of interest process.
From June 2, 2020, IBLIR depositors were to be paid a total of Sh3.2 billion over a period of four years.
Subsequently, the depositors would have cumulatively recovered 37.3 per cent of the deposits since 2015 when payments were commenced.
Following four payment disbursements, 45,700 out of the 50,000 (92 percent) depositors have accessed their funds in full.
In September 2020, following the acquisition of certain assets and assumption of liabilities by KCB, CBK required KDIC to appoint an independent external auditor, to carry out a comprehensive audit of IBLIR, based on terms of reference approved by CBK pursuant to Section 24 of the Banking Act.
CBK has assessed the recommendation by KDIC, the external auditor’s report, other pertinent information, and considered that liquidation would facilitate the orderly resolution of IBLIR in accordance with the Laws of Kenya.
KDIC will release information about the liquidation of IBLIR and payment of depositors in due course.
