This archive report was first published on 11 May 2021.
Published on May 11, 2021, the Kenya Deposit Insurance Corporation (KDIC) has announced plans to pay 85% of Charterhouse Bank depositors within the next 30 days.
According to KDIC Chief Executive Officer Mohamud Mohamud, the majority of the insured depositors who are protected by law and owed Sh500,000 and below make up the majority.
As of last year, KDIC revised the coverage limit to Sh500,000 from Sh100,000 after over 30 years, meaning that in the event of a bank liquidation, depositors will be paid a maximum of Sh500,000.
Charterhouse depositors are the second beneficiaries of the enhanced coverage after Chase Bank.
‘Our immediate task as KDIC as per law is that within 30 days to commence the process of paying the protected deposits. 85 percent of depositors in Charterhouse have Sh500,000 and less and are the small depositors who are the ones that we are going to fully compensate,’ Mohamud said.
Those owed over Sh500,000 are not losing out, but the bank has assets that KDIC will trace, preserve, and realize for their benefit.
Charterhouse Bank, linked to collapsed giant retailer Nakumatt, was placed under statutory management by the Central Bank of Kenya (CBK) in 2006 over money laundering and tax evasion claims.
The regulator cited gross violations of the Banking Act regarding lending, the accuracy of information submitted to CBK, and lack of account opening documentation for some customers.
Investigations are ongoing, and charges might be preferred against wrongdoers, Mohamud said.
