CBK: Local and foreign firms want to buy Chase Bank

Central Bank Governor Dr. Patrick Njoroge on Friday revealed that five local and international investors are in the race to take up a stake in Chase Bank in an effort to have the bank reopen within the shortest time possible.

The Governor, however, declined to name the interested parties saying it would scuttle the revival plans.

Locally, KCB, I&M Bank and Centum have all expressed interest in investing in the bank that was placed under receivership last week following a spate of panic withdrawals.

The Governor further pointed out that despite the introduction of a liquidity support framework by the Central Bank, it has now been a week and no commercial bank is yet to make use of it.

Njoroge says banks are yet to fully understand how the liquidity tool developed to help struggling banks works and thus slowing down its uptake.

Dr. Njoroge, however, says that banks seeking to borrow from the CBK need to draw up a comprehensive plan on how they will repay the funds.

It is believed that the strict disclosure requirements by the regulator have made banks hesitant in seeking the support they require.

The banking sector has come under focus after the closure of Chase Bank last week following a run on deposits that left the bank unable to meet its obligations.

Dr. Njoroge has defended the move by the regulator not to pump in money into the bank as the lender of last resort arguing the support could have done little to stem the panic withdrawals.