Imperial Bank KCB Group has began processing payments to Imperial Bank Limited in Receivership (IBLR) depositors following its acquisition of part of the defunct lender.
On Friday, the lender announced it had kicked off the payments on September 3 following approvals by IBLR receiver manager — the Kenya Deposit Insurance Corporation (KDIC)
The depositors are set to receive Ksh.3.2 billion over the next four years, an equivalent sum to the value of assets acquired by KCB in IBLIR in its final offer last year.
KCB will make a first tranche payment of Ksh.400 million representing 12.5 percent of total deposits before following up with a similar settlement at this time next year.
The balance of Ksh.2.4 billion will be payed in three tranches of Ksh.600 million on the second, third and fourth anniversary of the deal.
“This is significant progress in our efforts to ensure that Imperial Bank depositors receive their long-awaited dues. 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,” said KCB Group CEO Joshua Oigara.
In April last year, the Central Bank of Kenya (CBK) announced the final offer for IBLR in which KCB took up a slice of five branches in the collapsed lender.
In its statement which was subsequently followed by payments to IBLIR depositors, the CBK and KDIC insisted of their commitment to the depositors of the defunct bank.
“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 in a statement on April 5, 2019.
KCB which was charged with the role of disbursing payments confirmed 93 per cent of the bank’s eligible depositors had been paid fully.
The lender curved out five strategic branches from IBLR including two in Nairobi and one each in Mombasa, Diani and Eldoret.In August however, KCB trimmed Ksh.6.5 billion from its pay out after an audit of the IBLIR balance sheet.Imperial Bank went under in October 2015 with CBK placing it under KDIC management over what it termed as unsound business practices.At the time of grounding, the lender had 27 branches spread out across the country.Its placement into receivership would cause pain to not only depositors but also investors who bought into its issued corporate bond on the Nairobi Securities Exchange (NSE).Moreover, the […]
