IG Boinett orders arrest of top NBK, Chase Bank managers


Chase Bank

The Inspector General of Police Joseph Boinett has ordered the immediate arrest of six senior managers at National bank and two Chase Bank directors.

The eight managers from two banks are at the centre of an investigation of mismanagement and perpetuation of unethical banking practices.

The arrest comes a day after the Central Bank of Kenya Placed Chase Bank under receivership after it emerged the bank had concealed the amount of insider loans it had disbursed.

In the case of National Bank, the six managers including CEO Munir Ahmed are subject of an internal audit over the bank’s financial performance.  Other managers under investigation include Boniface Biko, Director Corporate Institutional and Business Banking, George Jaba, Head of Risk, Mohamed Abdallla, IT Director, Wycliff Kivunira and former Finance Director Chris Chesire.

Chesire had already been suspended by the bank following his link to misappropriation of finance while at Mumias Sugar.

After posting a third quarter profit of Ksh 3.2 billion, the bank announced a shock loss of Ksh 1.2 billion mainly due to under provision for non performing loans.

Chase Bank sacked its Chairman Zuffrullah Khan and Group Managing Director Duncan Kabui on Wednesday, the same day its restated its financials. The bank had irregularly lent Ksh 16.6 billion shillings to institutions and persons closely related to directors, shareholders and employees. In one case a director lent himself Ksh 7 billion without sufficient collateral.

The banking sector has come under sharp scrutiny following further revelations by CBK Governor Dr. Patrick Njoroge Ngugi of the emergence of creative accounting in the banking sector.

The eight managers are expected to present themselves to the CID headquarters.

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Story By Wangui Ngechu
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