News ID: 259899
Published: 1133 GMT October 08, 2019

Kenya’s biggest bank chases down defaulters to stem loan losses

Kenya’s biggest bank chases down defaulters to stem loan losses

KASS MEDIA GROUP

KCB Group Plc is pursuing defaulters as Kenya’s biggest lender combines recently purchased National Bank of Kenya Ltd. into its operations.

“You’ll see more actions, more demand letters going after our customers” who aren’t repaying loans, KCB Chief Executive Officer Joshua Oigara said on the sidelines of a conference in Nairobi, Bloomberg wrote.

 “Next year is the real recovery period for the loans we have for NBK.”

The acquisition of state-owned NBK, which has 49 percent of its loans classified as non-performing, will almost double KCB’s ratio of bad debts to 12 percent.

Oigara aims to bring the ratio down to eight percent a year after the consolidation, which will be completed during the course of 2020. The deal was approved last month by antitrust regulators.

The lender has already given debtors a taste of what’s to come. State-owned East African Portland Cement Co., the nation’s oldest maker of the building material, said it is seeking approval from shareholders to sell land and pay off 5.4 billion shillings ($52 million) it owes KCB.

Three days earlier, KCB won a court bid to place another struggling government-owned entity, Mumias Sugar Co., under administration to protect its assets.

 “That vigor will continue to remain,” the CEO said. “So we expect to recover a number of those loans.”

 

   
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