Court extends Imperial Bank’s receivership date

The receivership of Imperial Bank has been extended by another 90 days to enable the shareholders and the regulator explore other viable options of resuscitating the collapsed lender.

High Court Judge George Odunga on Friday made the decision following a consent reached by lawyers of the shareholders, Central Bank of Kenya (CBK) and the Kenya Deposit Insurance Corporation (KDIC) to extend the receivership.

The request had been made by the shareholders “so that a positive revival plan with all the stakeholders can commence”.

The bank’s receivership was scheduled to end on April 13 this year, upon which the receiver manager, according to the law, was to either confirm to CBK whether or not the bank can be revived.

The receiver manager may recommend that the bank be liquidated, if no viable revival strategy is found.

There are currently several applications before different courts, pursuing different interests in relation to the firm. These cases were filed after the bank was placed under receivership on October 2015.

At the same time, KDIC and CBK have opposed an application to have CBK Governor Patrick Njoroge, CBK chairman Mohamed Nyaoga and other CBK board members personally cited for contempt.

According to KDIC’s lawyer Philip Murgor, the contempt of court application is unconstitutional and should be struck out because “the CBK board members were not given an opportunity to be heard”.

The application had been filed by Imperial Bank shareholders claiming that CBK and KDIC have ignored a court order issued last year compelling them to share details of the firm’s status and discuss possible revival plans with all stakeholders.

The contempt of court application will be heard on May 17.

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