The Central Bank of Kenya (CBK) has made public that it has recovered Sh8 Billion from Chase Bank directors who reportedly awarded themselves hefty loans leading to collapse of the bank.
On Thursday, the regulator divulged that it had seized property worth the stated amount that had been irregularly purchased by the bosses.
According to CBK, some of the property that has been recovered include: a business park in Karen, various high-end properties in Dubai, a three-acre plot next to the German Embassy in Nairobi, a three-acre parking within the Capital and 240 acres of land on Mombasa Road.
The regulator's Governor Dr Patrick Njoroge stated that the holdings were acquired after the directors awarded themselves a 15-year interest-free loan disguised as 'Musharakah', a concept used in Sharia banking.
Njoroge added that those responsible for financial woes affecting the bank would be pursued with deliberate inconsistencies being unearthed as auditing continued.
“We have to hold these people to account. The population will not accept that they just walk around scot-free,” Njoroge was quoted by Business Daily.
Chase Bank was put under receivership earlier in April after experiencing liquidity issues which were attributed to issuance of large bad debts.
It later came to light that one of the directors had improperly awarded himself a Sh7.9 Billion loan above the limit set by the Banking Act, without any registered collateral.
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The bank was later opened on Wednesday after being taken over by the Kenya Commercial Bank which will now oversee its top level management.
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