Kenya-based Chase Bank chairman Mr Zafrullah Khan and group managing director Mr Duncan Kabui have stepped aside following concerns over the credibility of the lender’s financials.
“Following the publication of the 2015 financial statements Mr Zafrullah Khan and Mr Duncan Kabui have stepped aside from the positions of chairman and Group Managing Director respectively,” said the bank in a statement to the media.
Chase Bank has attracted attention after its earnings dropped from a profit of Ksh2.3 billion (around $22.7 million) in 2014 to a loss of Ksh742 million (around $7.3 million) in 2015.
Insider loans and advances jumped from Sh1 million ($9,800) to Sh10 million ($98,000) in the period under review.
Its non performing loans jumped from Ksh3 billion (almost $30 million) in 2014 to Ksh11 billion ($108.6 million) in 2015.
"The above statements and disclosures are extracts of the bank's financials as audited by Deloitte and Touche and received a qualified opinion," the bank said in the footnotes of its financials, this means that the information provided was limited in scope.
The country's banking regulator on Wednesday blamed mounting banking sector woes on weak lending policies and management failure.
The Central Bank of Kenya (CBK) told reporters that the high non performing loans in the sector could have been as a result of weak lending policies laced with management failures and interests.
The Central Bank of Kenya Wednesday said it will implement stringent checks even IT audits after National Bank managers were sent home following an audit by the board.
The Governor Dr Patrick Njoroge however said he wont comment on individual banks when asked about social media rumours over the health of Chase Bank. "We are going for stringent auditing of bank books including IT audits," the governor said.
Dr Njoroge also said that 80 per cent of the country's liquidity is held by the top seven bank.