Kenya central bank announces liquidation of remainder of Imperial Bank


A view of night traffic near the offices of the Central Bank of Kenya in the capital Nairobi, November 10, 2015. REUTERS / Noor Khamis / File photo

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NAIROBI, Dec.9 (Reuters) – Kenya’s central bank on Thursday announced that the rest of the Imperial Bank would be liquidated following an external audit which concluded that it was the only possible choice given the weak financial position of the bank.

The Central Bank of Kenya (CBK) ordered the private bank to go into receivership in October 2015 after the board of directors of the midsize lender alerted it to suspected misconduct.

At the time, Imperial Bank’s receivership shook confidence in the Kenyan financial sector, which has more than 40 foreign and local banks. The appointment of the receivers, who have run the bank for the past six years, followed shortly after the liquidation of a smaller bank.

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“KDIC (Kenya Deposit Insurance Corporation) will release information on the liquidation (…) and payment of depositors on time,” the bank said in a statement.

The KDIC is a public body which protects depositors in the event of bank failure.

In June of last year, KCB Bank Kenya (KCB.NR) acquired assets of the Imperial Bank worth 3.2 billion shillings ($ 28.37 million) and assumed responsibility for liabilities of a similar amount, the central bank said.

The central bank said an external audit on the rest of Imperial, now known as Imperial Bank Limited in Receivership (IBLIR), concluded that a liquidation was the only possible choice.

“The liquidation would facilitate the orderly resolution of IBLIR (…)

($ 1 = 112.8000 Kenyan shillings)

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Reporting by George Obulutsa; Editing by Lincoln Feast.

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