Kenya central bank head sees Chase Bank's receivership over soon


Reuters

* Identifying strategic investor for Chase Bank
    * Rains likely to offer inflation respite after surge

    GENEVA, March 21 (Reuters) - Kenya's central bank expects to
lift Chase Bank out of receivership soon by bringing in new
shareholders, the governor of the central bank, Patrick Njoroge,
said.
    The mid-sized lender was temporarily closed by the regulator
in April after an unexplained loss of billions of shillings. KCB
Group <KCB.NR> was appointed its receiver and the central bank
promised to return it normal operation by the end of the first
quarter of 2017. [nL8N1DU22N]
    Njoroge declined to say if it would meet its self-imposed
deadline of resolving receivership by the end of this quarter.
    "We have started the process of putting the bank back in the
regular field, means identifying a strategic investor...,
identifying business models that will be supported," Njoroge
told Reuters on the sidelines of a conference in Switzerland,
late on Monday.
    The temporary closure of Chase, which followed the closure
of Imperial Bank, another mid-sized lender, and Dubai BankKenya, a smaller lender, dented confidence in the industry,
which has also seen a jump in bad debts.
    The central bank froze issuance of new commercial bank
licenses in 2015 but it signaled earlier this month it was ready
to lift that moratorium, when it said it was finalising two
license applications. [nL5N1GQ3UX]
    Njoroge reiterated earlier remarks that a surge in inflation
to 9.04 percent last month was temporary, since it was caused by
shortages of some food commodities due to drought.
    "The risk is much smaller," he said, adding that it was up
to the central bank's monetary policy committee, which is
scheduled to set rates on March 27, to decide if the inflation
jump warranted a policy adjustment. Njoroge chairs the MPC.
    Kenya's main rainy season usually starts in April and
Njoroge said some of the commodities that drove up inflation,
such as green vegetables, could be widely available in markets
in June if all went well, reducing the pressure on prices.
    "It is less of a concern if rains come," he said.


 (Reporting by Tom Miles; Writing by Duncan Miriri; Editing by
Louise Heavens)
 ((duncan.miriri@thomsonreuters.com; Tel: +254 20 4991239;
Reuters Messaging:
duncan.miriri.thomsonreuters.com@reuters.net))

Keywords: KENYA CENBANK/



This article appears in: World Markets , Economy , Stocks , World Markets , Stocks
Referenced Symbols: KCB


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