July 24, 2018 / 3:49 PM / a year ago

Central bank says to start talks with KCB Bank on Imperial Bank sale

NAIROBI, July 24 (Reuters) - Kenya’s central bank said on Tuesday it would enter talks with KCB Bank Kenya Limited , the country’s biggest bank by assets, to buy Imperial Bank, a small lender that has been in receivership for nearly three years.

Imperial Bank Limited was placed in receivership in October 2015, after the board of the privately-owned lender alerted authorities to suspected malpractices.

The Central Bank of Kenya (CBK) and Kenya Deposit Insurance Corporation (KDIC) said in a joint statement that KCB had remained the sole bidder interested in Imperial.

KDIC is a state body that protects depositors in the case of a bank failure.

It and the central bank first received proposals from potential buyers for Imperial in April. Thereafter KCB Kenya and the other bank, whose name was not released, were approached, resulting in a revised proposal.

“The revised proposal was received from KCB Bank Kenya Limited, while the other bidder has withdrawn from the process,” KDIC and the central bank said.

“Having assessed the revised proposal, CBK and KDIC will engage KCB in discussions aimed at maximising the value for depositors.”

A KCB spokesman said the bank had no comment.

Placing Imperial Bank in receivership rattled confidence in Kenya’s financial sector where more than 40 foreign and local players operate. The move followed shortly after the liquidation of a smaller bank. (Reporting by George Obulutsa; Editing by Adrian Croft)

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