Counties cash goes under with Chase

The closure of Chase Bank has almost ground to a halt work at Kisii, Trans Nzoia and Kilifi county governments.

Kisii ward reps on Thursday failed to get salaries wired to their accounts at the bank’s local branch.

“The reps have been hit hard because we had just wired their pay to the bank when the announcement that it had been placed under receivership was made,” assembly Clerk James Nyaoga said yesterday.

The assembly had contracted the bank to administer mortgages and car loans for members of the county assembly but the institution gave a condition that the leaders’ pay must pass through its branch.

Mr Nyaoga said operations at the assembly were running smoothly since it had an imprest account with National Bank of Kenya.

Bassi Boitangare MCA Henry Moracha said he could not access his salary.

“I use my pay to help residents, attend funerals and other activities,” he said.

Kilifi County government’s account at the local Chase Bank branch had Sh11 million.

County finance chief officer Ben Kiai said cess and parking fees were usually wired to the account.

The devolved unit had operated the account for a year. It has opened a similar account with KCB.

“We have redirected cess and parking fees to KCB. We cannot undertake any project which required the use of those funds,” he said.

Also affected by the closure are needy students from Trans Nzoia. They cannot get money from the bursary kit.

About Sh50 million has gone under with the bank. The money was part of Sh68 million voted in the first phase of the Elimu Bursary Fund launched on March 24 by Governor Patrick Khaemba.

Only a few lucky students who received their cheques on time, were able to access their money.

“We don’t have the exact figures of those affected but hope the issue will be solved quickly,” County Chief Education Officer John Meng’wa said.

“We advise them to be patient as CBK handles the matter,” he said.

The Nation has learnt that the bank approached Elgeyo-Marakwet County government to open an account at the local branch just before it collapsed.

Meanwhile, Meru Governor Peter Munya has pleaded for a review of Chase Bank receivership period.

Mr Munya said the period was too long for the affected counties to cope.

“The government should stabilise the banking industry. Devolved governments cannot wait for long because they need the money to implement their projects,” he said.

Report by Brian Moseti, Samuel Kazungu, Philip Bwayo, Florah Koech, Oscar Kakai, Philemon Suter, Wycliffe Kipsang and Kennedy Kimanthi.