Imperial Bank depositors can breathe a sigh of relief after the Kenya Commercial bank (KCB) commenced on an exercise that will see them access their funds.
The eligible depositors, approved by the receiver manager- Kenya Deposit Insurance Corporation (KDIC), will be allowed partial access to their bank balances.
The Central Bank of Kenya (CBK) in May announced that KCB would acquire Imperial Bank’s assets valued at Sh 3.2 billion and assume its liabilities effective June 2, 2020.
KCB will pay the remaining Imperial Bank depositors a total of Sh 3.2 billion, same as the value of its assets over a four year period.
93 percent of the depositors have so far been paid.
This is the first payment on schedule in the transaction that commenced in 2019.
The schedule is as follows; 12.5 percent upon signing the agreement, 12.5 percent on the first anniversary of the agreement and 25 percent on the second, third and fourth anniversaries.
The depositors will cumulatively recover 37.3 percent of their deposits since 2015 when the bank commenced their payments.
“This is significant progress in our efforts to ensure that Imperial Bank depositors receive their long-awaited dues,”KCB Group CEO and MD Joshua Oigara said in a statement.
“We remain committed to support the recovery of funds and we are optimistic that these efforts will be a success in the fullness of time,” Oigara added.
Imperial Bank was founded in 1992 as a finance and securities company which later converted into a fully fledged commercial bank in 1996.
The bank was placed under receivership in October 13, 2015 after it was found to be engaging in inappropriate banking practices. CBK appointed KDIC as the receiver.