The Mombasa High Court has restrained the Kenya Deposit Insurance Corporation (KDIC) from winding up Imperial Bank. Justice John Onyiengo temporarily stopped the liquidation of the bank after businessman Ashok Doshi and his wife Amit sued over their KSh1 billion deposit.
The court further barred any payments to depositors in the execution of the Central Bank of Kenya’s directive.
Business Daily reported that through their lawyer Willis Oluga, they argued that on July 15, 2016, three months after the bank was placed under receivership, the lender consented to pay them their dues after they sued it.
“The consent is still binding to date and has never been reviewed, varied or set aside,” said lawyer Oluga.
“The appointment of KDIC as the liquidator has the effect of defeating the consent recorded in this suit since the legal status of Imperial Bank has changed from being in receivership to being in liquidation and the consent is no longer binding to Imperial Bank.”
Imperial Bank Limited (In Receivership) was placed under receivership in October 2015.
CBK says from June 2, 2020, the lender’s depositors were to be paid a total of Ksh.3.2 billion over a period of four years. Subsequently, the depositors would have cumulatively recovered 37.3 per cent of the deposits since 2015 when payments were commenced.
“Following four payment disbursements, 45,700 out of the 50,000 (92 per cent) depositors have accessed their funds in full.”
The case will be heard on January 10.