October 9, 2017 / 12:00 PM / a year ago

Kenya's central bank says has non-binding offer from Mauritius's SBM for Chase Bank

NAIROBI, Oct 9 (Reuters) - Mauritius’s SBM Holdings has given a non-binding offer for the acquisition of certain assets and liabilities belonging to Kenya’s Chase Bank, the Central Bank of Kenya (CBK) said on Monday.

The central bank wants to find a strategic investor for Chase but has not specified how big a stake it seeks to sell.

In May, CBK said 12 parties - including local and foreign banks - had expressed interest in the bank, which has no association with JP Morgan Chase & Co.

Also in May, SBM Holdings said it was bidding to buy a stake in Chase Bank.

“Central Bank of Kenya and Kenya Deposit Insurance Corporation announces that they have received a non-binding offer from SBM Holdings Limited with respect to Chase Bank (Kenya) Limited (In Receivership) (CBLR),” the central bank said in a statement.

“The non-binding offer includes the acquisition of certain assets and matched liabilities from CBLR. Whilst the non-binding offer is still subject to confirmatory due diligence and a binding contract.”

The central bank and the Kenya Deposit Insurance Corporation said the offer was a viable avenue to resolve Chase Bank’s receivership and that Chase Bank shareholders had supported the offer.

“If agreed, it is expected that the proposed transaction will be concluded by the end of 2017,” the central bank said.

Regulators placed the mid-sized Chase Bank under receivership in April 2016 after an unexplained loss of billions of Kenyan shillings.

Chase is in the hands of the Kenya Deposit Insurance Corporation, a state body that protects depositors in case of bank failure.

In November 2016, SBM Holdings acquired Kenya’s Fidelity Bank for a token payment of 100 shillings ($0.97) and said it would inject 1.45 billion shillings of fresh capital into it. ($1 = 103.2000 Kenyan shillings) (Reporting by George Obulutsa; Editing by Aaron Maasho)

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