This archive report was first published on 19 December 2019.
Published on December 19, 2019, Kenya Commercial Bank's NBK has taken drastic measures to recover from massive debt by placing the Kenya Red Cross-owned Boma Hotels under receivership.
The affected hotels include Boma Hotel Nairobi and Boma Inn Eldoret, which have been struggling to stay afloat despite their intended purpose of generating income for the Kenya Red Cross.
According to NBK's financial reports, the last time the said businesses made profits was in 2011, with losses mounting to Ksh1.4 billion in just three years.
On December 16, 2019, NBK appointed PVR Rao as an administrator of the said properties, with a clear directive that no one is authorized to transact any business on behalf of the company without express written consent from the administrator.
The then Abass Gullet-led Kenya Red Cross has been making massive losses, with allegations of book manipulation to cover up the mess.
Responding to the reports of receivership, the Kenya Red Cross confirmed the difficulties in the current business environment in Kenya, stating that they have gone into a process of administration to return the hotels to a profitable path.
While Boma Hotel in Nairobi was reportedly the hardest hit, Boma Inn Eldoret apparently has no pending loan.
