Kenyans on Thursday flocked at different branches and ATMs of Chase Bank after the Central Bank of Kenya (CBK) put the bank under statutory management for a year due to what the regulator termed as unsafe financial conditions.
The regulator said on Thursday that it had taken the drastic decision saying Chase Bank had experienced “liquidity difficulties.”
“The Central Bank of Kenya has today Thursday appointed Kenya Deposit Insurance Corporation (KDIC) as the receiver manager for Chase Bank Limited for a period of twelve months, pursuant to the provisions of Sections 43 (1), 43(2) and (53)1 of the Kenya Deposit Insurance Act, 2012,” said CBK in a statement.
It furthered by saying “Chase Bank Limited experienced liquidity difficulties following inaccurate social media reports and the stepping aside of two its directors. Consequently it was not able to meet its financial obligations on April 6, 2016.”
K.D.I.C will assume the total bank management and control.
The board of directors will be in exclusion of any operations. KDIC will then advise the CBK of an appropriate resolution strategy as soon as it is practicable and not later than twelve months.
Chase Bank chairman Mr Zafrullah Khan and group managing director Mr Duncan Kabui resigned on Wednesday over the credibility concerns of the bank’s financial statements.