KCB emerges front runner for Imperial Bank
Kenya Commercial Bank (KCB) #ticker:KCB is the only candidate left in the race to acquire the assets of collapsed Imperial Bank, the Central Bank of Kenya (CBK) said Tuesday.
In a joint statement with the Kenya Deposit Insurance Corporation (KDIC), the CBK said only KCB had submitted a revised proposal to take an equity interest in Imperial Bank, the lender that has been in receivership for 33 months.
“The revised proposal was received from KCB, while the other bidder has withdrawn from the process. Having assessed the revised proposal, the CBK and KDIC will engage KCB in discussions aimed at maximising the value for depositors.”
The CBK and KDIC in mid-April said they had received and assessed proposals from interested parties, but decided to go back to them with a view to improving the bids so as to maximise the value for depositors.
Shortlisted investors were then granted access to a comprehensive confidential data room that allowed them to develop a formal proposal for Imperial Bank, after completing appropriate confidentiality agreements with CBK.
The decision by the rival bidder, who the CBK did not name, to step out of the race now leaves KCB to complete the transaction.
In a lengthy process that was handled by auditing and advisory services firm KPMG, the bidders were among other things asked to disclose the oversight resources they plan to bring on board, the type of transaction contemplated and the financial resources that could be made available to compete the transaction.
The CBK on Tuesday said it had now moved to engaging stakeholders on the next phase of action. The beckoning resolution will also be a sigh of relief for customers, whose deposits have been locked in the bank for nearly three years.
“The CBK and KDIC will provide further details to stakeholders at the appropriate time,” the two institutions said adding that they are committed to protecting the interests of depositors, creditors and the public.
Imperial Bank held Sh58 billion in customer deposits at the end of June 2015 and was classified as a mid-tier lender with operations in Kenya and Uganda. It had 52,398 deposit accounts at the end of 2014.
The deal comes way after the CBK’s timetable shared in September last year indicated that it had hoped to engage the winning bidder on February 2 and finish up the process.
KCB was said to have had an interest in acquiring Chase Bank but that did not materialise as the Mauritian lender SBM Holdings got the deal.
Its link to acquiring National Bank of Kenya also proved to be not official as Competition Authority of Kenya confirmed not to have received any application.