The Central Bank of Kenya (CBK) and Kenya Deposit Insurance Corporation (KDIC) have issued a tentative timeline and prospective milestones for the resolution of the Imperial Bank Limited’s receivership.
This follows the granting by the High Court in June of a 90-day extension of the receivership of the Imperial Bank Limited. The objective of the resolution, the CBK through a statement said, is to safeguard the interest of depositors, creditors and the wider public interest.
After the initial preparations, the timeline shows, the formal process will commence with an invitation for Expressions of Interest (“EOI”) from potential strategic investors, and the Bank’s shareholders (if they so wish, in taking an interest in the Bank).
The EOIs will be evaluated and a shortlist of qualifying investors (“Shortlisted Investors”) determined in a fair process using appropriate and objective criteria based on, inter alia, regulatory imperatives and prudential guidelines which will ensure the speedy recovery for depositors, creditors and other stakeholders of the Bank, whilst also mindful of seeking to preserve and develop a sound and innovative banking system in Kenya.
Shortlisted Investors will be invited to pursue a more detailed engagement and will be granted access to a comprehensive confidential “Data Room” of financial, legal and business performance information to develop their formal offer to take an interest in the Bank (“Investor Proposal”). A preferred investor would be selected based on the Investor Proposals, which would lead to final negotiations and completion of the transaction.
Mindful of the concerns by depositors and the need for the process to be fully credible to potential strategic investors in order to maximize the value for depositors, the entire process is anticipated to be about 48 weeks. And to ensure that the process is fully credible from the start, CBK and KDIC intend to seek an extension of the receivership of IBLR for up to 12 months.
