Investors eyeing to buy an equity stake at distressed lender Imperial Bank have until Friday September 29 to express their interest.
The Central Bank opened the expression of interest window on Friday, paving the way for potential investors to submit their bids or even propose other transaction structures for the bank that is currently in receivership. The regulator said audit and consulting firm KPMG have been appointed as advisors for this process.
It is hoped that an equity investor will help pump in much-needed life into the distressed private institution, which was taken over by the CBK on October 13, 2015, and handed over to the Kenya Deposit Insurance Corporation as receivers.
“The objectives of this process is to safeguard the interest of depositors, creditors and the wide public interest, whilst being mindful of seeking to preserve a sound and innovative banking system in Kenya,” CBK said in a notice.
By the time of its collapse, Imperial Bank was estimated to have been holding in excess of Sh80 billion in customer deposits.
The notice said the process and timing beyond February 2, 2018 would be informed by the structure proposed by the preferred bidder. It is however expected that the process to get an equity investor will be completed within 48 weeks from July 31, 2017, when the High Court granted a 12-month extension of the receivership.
“This [extension] was following agreement between the shareholders, KDIC, CBK and depositors to enable CBK and KDIC to invite expression of interest from potential strategic investors that would lead to a resolution of the receivership,” the regulator added.
Among other conditions, the interested investors should demonstrate their interest in banking in Kenya and prove that they intend to have a long-term presence in Kenya. They should also provide evidence of an understanding of the Kenyan and East African banking sector.
The potential investors must also provide the ownership details showing immediate and ultimate shareholding parties that may hold beneficial ownership in Imperial Bank directly or through the proposed acquiring entity. In addition, they must show their skills support detailing the nature of banking experience, management capacity, governance and oversight resources available that the strategic investor is bringing to the bank.