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Fortune Finance Limited
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Kanu-era bank that collapsed with Sh320m set to wind up

Fortune Finance Limited, a financial institution that has been under liquidation for 18 years, is set to wind up, bringing to the end a bank that collapsed with Sh320 million depositors’ cash. According to the Kenya Deposit Insurance Corporation (KDIC), good assets have been exhausted and dividends not received are unlikely to offer value to creditors.

Kanu-era bank that collapsed with Sh320m set to wind up

As at June 2017, the KDIC had paid out Sh23 million of the Sh33 million protected deposits that Fortune had at the time of collapsing. FILE PHOTO | NMG

Fortune Finance Limited, a financial institution that has been under liquidation for 18 years, is set to wind up, bringing to the end a bank that collapsed with Sh320 million depositors’ cash. Fortune Finance Limited, a financial institution that has been under liquidation for 18 years, is set to wind up, bringing to the end a bank that collapsed with Sh320 million depositors’ cash.According to the Kenya Deposit Insurance Corporation (KDIC), good assets have been exhausted and dividends not received are unlikely to offer value to creditors.“We believe we have exhausted those realisable assets and the cost of liquidating is now going to surpass the value of the assets. That is why we have to call for the release of the liquidator as per the winding up order,” said chief executive Mohamud Mohamud.

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He told the Business Daily in an interview that creditors have 21 days to review Fortune’s final accounts and if there are no objections, it would be wound up and KDIC released as liquidators.The agency said it expects Sh95,906 from the Unclaimed Financial Assets Authority, which will be used to cover any additional expenses that it may be obligated to settle before deregistration of the firm.This will bring to an end the existence of Fortune Finance.As at June 2017, the KDIC had paid out Sh23 million of the Sh33 million protected deposits that Fortune had at the time of collapsing.Once a bank is placed under liquidation, depositors are paid up to Sh100,000 – the maximum to protected depositors – usually within two years. Unclaimed money is included in dividends thereafter.Mr Mohamud said that it was impractical to recover and pay out the entire Sh320 million since most loans had been exaggerated with interests as high as 75 per cent while some lacked security or proper documentation.“Liquidation is a painful resolution option. Going forward, we want to resolve banks as going concern instead of exposing depositors to such long waiting,” he said.

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