Chase Bank takes more steps towards full recovery

Chase Bank has made a big step towards full recovery after the Central Bank of Kenya (CBK) yesterday allowed the financier to resume lending to customers and take fixed deposits after four months of waiting.

The nod expands the lender’s basket of financial services after it was placed under receivership in April by the CBK – the banking sector regulator – prompting its closure and subsequent reopening later in the same month.

The bank had been limited to only a few services such as money transfers and automated teller machine (ATM), and was awaiting the approval to accept deposits and issue loans.

“The move marks a major milestone in the turnaround efforts of the bank, signalling that most of the major issues under resolution have been addressed, paving the way for full resumption of banking services to all customers,” the lender said in a statement yesterday.

The greenlight to take new deposits, the lender says, will provide more lending opportunities to customers and accelerate the pace of recovery.

It was placed under the receivership of the CBK arm – Kenya Deposit Insurance Corporation (KDIC) in April.

The regulator early this month said it will next month pick a new investor to buy a majority stake in Chase Bank as part of efforts to fully revive the lender.

This came after KCB Group, which was appointed to manage Chase Bank, said that its role in reopening the lender is almost complete, paving the way for the regulator to call for bids from multiple investors interested in the buyout.

KCB is expected to be among companies that will bid for Chase Bank, whose model is focused on small and medium-sized enterprises (SMEs).

Chase Bank represents an attractive franchise with 27,000 customers, largely SME businesses.It is also a banker to 341 non-governmental organisations and 147 savings and credit cooperative societies (saccos).

The lender has 62 branches and boasts subsidiaries Rafiki Microfinance Bank and investment bank Genghis Capital.