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Kenya Deposit Insurance Corporation v. Richardson & David Limited & Central Bank of Kenya Limited

(2015) JELR 100065 (CA)

Court of Appeal  •  Civil Appeal 66 of 2016  •  15 Dec 2015  •  Kenya

Coram
Erastus Mwaniki Githinji, George Benedict Maina Kariuki, Sankale ole Kantai

Judgement

JUDGMENT OF THE COURT

INTRODUCTION

1. Richardson and David Limited, is a limited liability company. It was a depositor with a Bank called Dubai Kenya Limited (hereinafter referred to as “DBK”) where it held Shs.142,000,000/= in shilling account No. 81199809 (Shs.4,816,860.57) and US $1,130,264.85 in dollar account (No.81199817).

2. On 14th August 2015, the Central Bank of Kenya placed DBK Bank under receivership and appointed Kenya Deposit Insurance Corporation (“KDIC”) as a receiver for a period of 12 months pursuant to Section 43(1) and (2) and 53(1) of Kenya Deposit Insurance Corporation Act 2012. On 25.8.2015, the CBK appointed KDIC as a liquidator of DBK.

3. The reasons that led to this action by the Central Bank of Kenya (“CBK”) included failure by DBK Bank to meet daily cash reserve ratios; failure to honour several financial obligations as and when they fell due including Ksh.48.18 million due to the Bank of Africa Kenya Limited; failure to meet cash reserve ratio requirements fro…

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