The Kenya Commercial Bank of Kenya (KCB Group) next month will hand over Chase Bank under receivership to SBM Holdings Ltd.
SBM, the third largest company listed on the Stock Exchange of Mauritius completed the acquisition of Chase Bank Kenya when the Central Bank of Kenya and the Kenya Deposit insurance corporation (KDIC) announced the receipt and acceptance of a Binding offer from it.
According to the Group’s CEO Joshua Oigara, they could not have bought Chase Bank since they were the managers handling the whole process.
“We are very happy to have been the first bank in curating another bank in Kenya. And we shall be handing over to SBM Holdings on 15th February 2018,” said Oigara on Friday.
“We did it for the sake of strengthening our financial sector, which is the purpose for the existence of large banks,” said Oigara.
The KCB Chief added that they were mandated with being referrals to any interested buyer thus they could not have been on the list of buyers.
Chase Bank will be SBM’s second acquisition in East Africa after acquiring Fidelity Bank in May last year.
The offer, which the Central Bank of Kenya (CBK) accepted on early this month, includes the acquisition of certain assets and matched liabilities of Chase Bank (Kenya) Ltd (In Receivership) — CBLR.
CBK said SBM’s binding offer represented a viable proposal for the substantial resolution of Chase Bank, for the benefit of depositors and the strengthening of the Kenyan financial sector.
“It is expected that the transaction will be concluded upon the execution and operationalization of the offer,” read the statement.
SBM has a market capitalization of approximately $600 million, with the government of Mauritius as a significant shareholder, and total assets in excess of $4 billion.
Chase Bank was placed under receivership in April 2016 following revelations of financial mismanagement that led to a bank run.
In April 2016, KCB took over management of the bank with a plan to fine-tune the modalities of an acquisition.
Then, the CBK Governor Dr. Patrick Njoroge had said “In selecting the suitable bidder of Chase Bank, we looked at Speed, Liquidity, credibility and strong Management. KCB’s credentials as a strong bank with a solid brand, adequate human resources and wide experience in the country, will facilitate safeguarding the interests of CBL’s depositors and creditors and the wider public interest.”