Central Bank of Kenya Approves Liquidation of Charterhouse Bank Limited

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Central Bank of Kenya Kisumu Branch I Khusoko

The Central Bank of Kenya (CBK) has approved the liquidation of Charterhouse Bank (CHB) Limited by appointing Kenya Deposit Insurance Corporation (KDIC) as its liquidator.

The lender has been under statutory management since 23rd June 2006 as a consequence of “…severe violations of the Banking Act by Charterhouse Bank relating to lending, the accuracy of returns submitted to CBK, and failure to obtain account opening documentation for a number of customers.”

The Statutory Management Report by the Statutory Manager on May 6, 2021, recommended that CHB be liquidated.

“The report indicates that in view of the severe violations of the Banking Act by CHB and its inability to address them, liquidation is the only feasible option,” the CBK said Friday.

CHB was set up in 1996 after taking over the operations of Middle East Kenya Finance Limited. The institution then converted to a full-fledged Bank in 1998.

It had ten branches in Nairobi, Kisumu and Mombasa, 8 of these branches at the then Nakumatt Supermarket, an associate of CHB.

By 2006, CHB was positioned at 31 out of 41 with an asset base of KSh 4 Billion and a market share of 0.55%. 

It had 428 loan accounts valued at KSh 2.9 Billion and 4,699 deposit accounts valued at KSh 2.9 Billion.

 becomes the second lender in a span of three weeks to undergo liquidation after Chase Bank Limited on 16th April 2021.