Imperial Bank depositors may wait one more year to get funds

Imperial Bank depositors to wait for a year to access their money 
Imperial Bank depositors may wait for a year to access their money through KCB counters if the deal goes through.

On Thursday, KCB boss Joshua Oigara said it may take up to 90 days to conclude the deal on the structure of the sale and a further 9 months to close it given the experience seen with Chase Bank.

"The resolutions depend on Central Bank of Kenya and Kenya Depositors Insurance Corporation. But if you look at the other lender, it took around nine to ten months to close,” Mr Oigara said.

Chase Bank, which was put under receivership in April 2016, will open its doors on Monday for full access of deposits under the State Bank of Mauritius after nearly two and a half years.

SEE ALSO :CMA gets nod to punish former Imperial directors

SBM is also on the clear after bondholders failed to get legal backing to pursue their interests during a meeting in Nairobi on Tuesday.

"Legally it is correct since we have no proper banking resolution in place since we did not have a bond market for banks for a long time. CBK should create a small task force to rewrite crystal clear rules on bonds and debentures and how they are treated in bank and financial institutions collapse," a bondholder told Weekend Business.

The bulk of Imperial Bank customers were initially allowed to withdraw up to Sh1 million when the lender first opened under the management of KCB and Diamond Trust Bank.

NIC Bank was later given reigns of the lender and made two disbursements totalling Sh10.78 billion to over 5,500 depositors on behalf of KDIC.

Mr Oigara said the acquisition is not a big ticket buy and it will target only the high-quality assets in the failed lender in a carve-out deal like SBM deal with Chase Bank.

"The deal is a partial acquisition of assets and the good quality assets, I hear some of you say we have to take a much bigger provisioning but that is not the case,” Mr Oigara said.

The parties are yet to make public the terms of the deal. 

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Imperial BankKCBCentral Bank of Kenya