SBM Bank of Kenya, which was cited for Sh900 million Chase Bank collapse, has been ordered to refund Afrasia Bank limited Sh904 million in 3 weeks.
Through a notice written by the Mauritian lender, SBM Bank are to also refund an interest of Sh2 million (16,645 dollars) within 21 days and failure to which, it will be forced to take liquidation proceedings against SBM Bank.
“Further take notice that failure to pay the afore-stated amount shall result in Afrasia Bank limited filing for a liquidation order against the company,” it stated.
The notice also stated that the money should be paid in Mauritius or its lawyers Githii and Co Advocates.
This move follows a court ruling made by Justice Wilfrida Okwany declaring that SBM is responsible for all liabilities Chase Bank acquired in 2018 which includes deposits made by Afrasia Bank.
“I, therefore, find that the respondent is liable for all liabilities of Chase Bank including the appellant’s claim herein,” Okwany said.
She ruled that the Transfer of Business Act was applicable in the deal and since SBM did not publish the mandatory notice under the law, it is accountable for the debt owed by Chase Bank.
However, SBM opposed the claim saying the general public was informed about assets that were to be taken over by SBM and those that would remain under Chase Bank.
Chase Bank was acquired by SBM Bank on August 17, 2018, and Afrasia argued that it inherited the liability.