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Hacktivists target Central Bank of Kenya Website

Hackers target Central Bank of Kenya Website

Over the weekend, hacktivists conducted distributed denial-of-service DDoS attacks on the websites of four International banks including the Central Bank of Kenya (CBK).

The other banks include National Bank of Panama, Central Bank of Bosnia and Herzegovina and Maldives Monetary Authority.

According to Hacknews, hacktivists only referred to as Anonymous and Ghost Squad began conducting cyber attacks on banking websites worldwide over a week ago.

This particular hack is said to have been executed by Ghost Squad on Saturday morning. All of the sites are now back online, an event that might go unnoticed to most people.

CBK Website Hacked

Screenshot showing all four banks were down after the attack

The National Bank of Panama was of special interest to the hackers due to the recently leaked documents known as Panama Papers.

The operation by hacktivists is against banks and financial institutions around the world. The hacktivists believe banks are controlling the world’s economy, promoting and hiding corruption at governmental and private level.

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Lipa na M-Pesa PayBill Numbers for Banks in Kenya

Mpesa Bank Paybill Numbers for All Banks in Kenya

Banks in Kenya have embraced M-Pesa across the board to provide their customers with fast, easy and convenient access to their money.

Safaricom Lipa Na M-PESA PayBill is a cash collection service that allows small or medium sized business to collect money on a regular basis from their customers.

The following is a list of Lipa na M-Pesa PayBill numbers for mobile banking services by different banks in Kenya.

BANK INSTITUTION M-PESA PAY BILL NUMBER
Bank of Africa(BOA) 972900
Barclays Bank K LTD 303030
CFC Stanbic 600100
Chase Bank 552800
Comm. Bank of Africa 880100
Consolidated Bank LTD 508400
Co-operative Bank 400200
Credit Bank 972700
Diamond Trust Bank(DTB) 516600
Ecobank 700201
Equatorial Commercial Bank 498100
Equity Bank 247247
Family Bank Ltd 222111
Faulu DTM 328585
First Community Bank Ltd 919700
GTBank Kenya Ltd 910200
Gulf African Bank 985050
Housing Finance Company LTD 100400
I & M Bank Limited 542542
IMPERIAL BANK LTD 800100
Jamii Bora Bank 529901
KCB 522522
K-REP BANK (Now Sidian Bank) 111999
KWFTDTM 101200
Musoni 514000
National Bank 625625
NIC Bank Limited 488488
Post Office Savings Bank 200999
Rafiki DTM 802200
Sidian Bank 111999
SMEP DTM 777001
Standard Chartered Bank 329329
Transnational Bank 862862
UBA Bank 559900
Vision Fund Kenya 200555; 549900
ABC Bank 111777
CITIBANK N.A KENYA 100229
Prime Bank 982800
Uwezo DTM 504600

 

Chase Bank to reopen under KCB Management

Chase Bank to reopen under KCB Management

Following the receivership of Chase Bank Kenya over financial trouble, the Central Bank of Kenya (CBK) has announced that the bank will reopen on April 27 under the Kenya Commercial Bank’s (KCB) management.

Customers will have immediate access to their deposits up to a maximum of Sh1 million, CBK says.

167,290 accounts, equivalent to 97 per cent of accounts or 6 per cent of total deposits, will have their funds available in full.

The deal with Kenya Deposit Insurance Corporation, signed at 8.30am on Wednesday, will see the bank’s 62 branches reopened by next Wednesday, April 27  2016.

The CBK had received nine proposals, including six from local investors, two foreign and one from existing Chase Bank shareholders.  The bank’s shareholders had proposed to inject more cash for its revival.

KCB was chosen for their offer to re-open the bank immediately as well as their credibility and cash to support operations. The reopening will be followed by their eventual acquisition of a majority stake in the bank.

Other announcements from the acquisition are as follows

  • Deposits in excess of Ksh.1 million will be made available in a structured manner, details of which will be released in the near future.
  • The moratorium on payments to creditors and lenders remains in place. However, the Manager will correspond with them in the near future with details of how these would be dealt with.
  • Ongoing efforts to collateralize existing loans and recover funds that were obtained irregularly or are non-performing will be stepped up. Existing borrowers are required to continue servicing their facilities.
  • CBK and KCB will ensure that Chase Bank Ltd (In Receivership) will have adequate liquidity for its operations.
  • KCB will make available a management team that will assist in the receivership.
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Banks & Financial Institutions under Liquidation in Kenya

Financial institutions currently under liquidation in Kenya

Seventeen (17) financial institutions are currently under liquidation in Kenya.

Liquidation is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations as and when they come due. The company’s operations are brought to an end, and its assets are divided up among creditors and shareholders.

The following banks are currently under liquidation in Kenya, some of which payments to customers and shareholders is underway through the Kenya Deposit Insurance Corporation.

Institution Name Liquidation Date
1. Post Bank Credit Ltd. 20th May 1993
2.  Meridien BIAO Ltd. 15th April 1996
3.  Ari Bank Corporation Ltd. 5th December 1997
4.  Reliance Bank Ltd. 12th September 2000
5.  Trade Bank Ltd. 18th August 1993
6. Thabiti Finance Co. Ltd. 19th December 1994
7. Fortune Finance Co. Ltd.  14th September 2000
8. Daima Bank Ltd. 13th June 2005
9. Dubai Bank Kenya Ltd. 24th August 2015
10.  Prudential Building Society  18th January 2005
11. Middle African Finance Ltd. 20th August 1993
12. Pan African Bank Ltd. 18th August 1994
13. Pan African Credit & Finance Ltd. 18th August 1994
14. Kenya Finance Bank Ltd. 29th October 1996
15. Prudential Bank Ltd. 5th May 2000
16. Trust Bank Ltd. 15th August 2001
17. Euro Bank Ltd. 21st February 2003

 

Stakeholders can follow up with the Kenya Deposit Insurance Corporation which is located at 1st Floor, CBK Pension House, Harambee Avenue, Nairobi, Kenya. Their website is http://www.depositinsurance.go.ke/.

Those with questions can call the KDIC on Tel. No. 0770 887992. Customers can also contact KDIC on email: kdiccommunications@depositinsurance.go.ke for more information.

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How to Choose a Bank in Kenya

3 banks have been put under receivership over the last 2 years. It’s safe to say that banking in Kenya has become a high risk venture. How then can you choose the right bank?

CBK classifies banks into tiers. Tier 1 is made up of the big old banks. These will ALMOST certainly never go under in a similar way as Chase or Imperial. They have millions of clients and hundreds of billions in assets. Some have government participation while others are locally and foreign owned.

6 banks make up the top tier, and collectively control 49.9% of the market. The banks are as follows-:

  • KCB
  • Equity Bank
  • Cooperative Bank
  • Standard Chartered
  • Barclays Bank
  • CBA

16 other banks make up Tier 2, and collectively control 41.7% of the market. The most stable of Tier 2 being the following banks

  • CFC Stanbic
  • NIC
  • Diamond Trust Bank
  • I&M
  • Chase Bank
  • Bank of Africa
  • Family Bank
  • Ecobank
  • Housing Finance

The last tier, Tier 3 is made up of 21 small banks that control 8.4% of the market. The following diagram provides a clear picture of the classification.

3.x3 matrix of Kenyan Banks

In June 2015, CfC Stanbic lost top-tier bank classification to CBA after dropping its market share by 0.5 percentage points to 4.92 per cent.

Changes in market share in the banking sector are mainly occasioned by growth in customer deposits as banks deployed various strategies for deposits mobilisation.

CBK has previously put over 3 banks under the Kenya Deposit Insurance Corporation (KDIC) receivership which include the recently troubled Imperial Bank, Dubai Bank and now recently Chase Bank.

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What is a Receivership?

According to PWC, a Receivership is a remedy available to secured creditors to recover amounts outstanding under a secured loan in the event the company defaults on its loan payments. A Receiver may also be appointed in a shareholder dispute to complete a project, liquidate assets or sell a business.

In Kenya, the Central Bank of Kenya (CBK) has previously put over 3 banks under the Kenya Deposit Insurance Corporation (KDIC) receivership which include the recently troubled Imperial Bank, Dubai Bank and now recently Chase Bank.

Typically, the process begins with the appointment of a Receiver either by the secured creditor under a security agreement (“Privately Appointed Receivership”) or by the Court on behalf of a secured creditor (“Court Appointed Receivership”). Only a licensed Trustee in Bankruptcy can act as a Receiver.

Privately Appointed Receivers will generally only act on behalf of the secured creditor that appointed them and will realize on the assets specifically covered by the loan agreement. Court Appointed Receivers however, are officers of the Court and act on behalf of all creditors. The powers and rights of Court Appointed Receivers are included in the Court order that appointed them.

The Receiver is appointed to take possession of and sell or liquidate the assets secured by the security agreement in order to repay the outstanding debt.

In a Receivership, a secured creditor or the Court may also appoint a Receiver-Manager to operate and manage the business until it is sold as a going concern.

The Receiver’s duties also include notifying creditors of the receivership and regular reporting to the Official Receiver (a representative of the Office of the Superintendent of Bankruptcy) and/or the Court on the status of the receivership.

Receivership and bankruptcy are not mutually exclusive, they can occur at the same time or a receivership can occur without a company being bankrupt. The same firm may act as Trustee in Bankruptcy and Receiver, but often different firms are appointed to these roles.

The Receiver is tasked with selling the assets secured under the security agreement and after deducting the receivership’s fees and expenses, distributing the proceeds from the sale to creditors on a priority basis. In situations where the proceeds from the sale of assets are not sufficient to fully repay the liabilities of the secured creditor, no realizations will be available for distribution to the unsecured creditors.

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Guest post – How to tell if your bank is in trouble

Patrick Kagunya is the Director Financial Advisory at Getworks and Chief Executive Officer at Wescotts Financial Consultants. He offers some insight on how to tell if your bank is in trouble.

With Chase Bank in receivership most depositors must be asking themselves so which bank is safe ?

Spotting trouble isn’t easy (witness the current crisis), but there are some warning signs, if you know where to look. The KDIC and CBK keeps these quarterly financial reports on every Kenya financial institution.

Clearly, economic conditions have changed in the last three months, and as detailed as these reports appear to be, there still are plenty of unknowns. However, these reports do offer some clues as to your bank’s ability to weather the storm.

First, a healthy word of warning: A few numbers in a report don’t mean you should snatch your funds and run for cover. If you’re worried that your bank might teeter, don’t panic. Talk at length with your financial adviser before making any sudden moves. If you want some extra protection in the meantime, think about diversifying your risk by making additional deposits in a few other banks.

One important measure of a bank’s financial stability is its risk-based capital ratio. By law, commercial banks need to keep a certain amount of capital on hand to cushion their loan portfolios. The CBK mandates that a bank’s risk-based capital be no less than 8% of its total assets.

Next, look at the bank’s loan-to-deposit ratio. Even if your bank didn’t lard up on mortgage-backed securities, it might still be “loaned up”–meaning that it has maxed out its percentage of loans to deposits on hand. The larger that percentage, the greater the risk the bank has taken on. If customers begin to pull deposits, the bank might be suddenly strapped for cash.

Healthy loan-to-deposit ratios typically fall between 95% to 105%,. Venture much higher than that and the bank could be courting trouble. To find this ratio, divide “loans and leases, net of unearned income and allowance” by “deposits”.

A third metric is the percentage of the amount of non-current loans (those 30 days or more past due) vs. total amount lent. Some fraction of those non-current loans will have to be written off, eating into the bank’s precious capital.

“When 10% of your loans are non-performing, that starts to become very problematic,”.

To calculate your bank’s percentage, divide the total amount of loans that are 30 days or more past due by total loans and leases.

If your bank is struggling and the KDIC takes it over, know that you may not have access to your funds for several days during the change-over period. To be safe, small-business owners should have a week’s worth of operating expenses deposited in more than one bank.

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Mobile Banking Apps to Manage your Finances

Mobile Banking Apps to Manage your Finances

Banking and finance apps are one of the most sought after pieces of innovation in Kenya aiming to serve millions of citizens who are banked with a possibility of luring the unbanked to diverse product offerings.

While innovation and creativity in the Kenyan banking industry has been limited to SMS banking for a while, accredited finance institutions are quickly targeting native mobile application users more on the Android platform than any other mobile operating system.

We have come up with a list of the available apps on various platforms prominent among them being the Google Play Store.

This banking apps at the least will ease your hassle and reduce the time you have to spend in queues in various banking halls.

Barclays Bank of Kenya

Barclays-Bank-Kenya-mobile-banking-appAlong with its Internet Banking service, the Barclays Bank of Kenya is among the banks in Kenya to have a complimentary mobile application launched in June 2013 that serves both personal and business clients. The application is available on the android platform for versions above 2.2. So far between 5,000 to 10,000 clients are using the application.

You can download Barclays Bank of Kenya app from the Google Play Store here.

 

Ecobank Kenya

Ecobank-Kenya-mobile-banking-app Like most banking applications in Kenya, the Ecobank mobile banking allows its banking clients to top up their mobile phones with airtime from major mobile operators such as Safaricom and Airtel. Internet and External fund transfers are on the go which cuts down on the effort to meet the bankers in person. Available on the android platform for versions above 2.2, the app has between 1,000 to 5,000 users.

You can download from the Google Play Store here.

 

Equity Bank of Kenya (Eazzy 247)

equity-bank-kenya-mobile-banking-appBeing among Kenya’s most profitable banks, Equity Bank has a mobile banking application dubbed Eazzy 247 that opens up an opportunity for its clients to access their account financials including statements as well as pay bills such as electricity, water, HELB, DSTV bills and others. The app is available on the Google play store with downloads between 10,000 – 50,000. You can download from the Google Play Store here.

The application is also complimented by unofficial apps such as the Equity Direct Mobile which is a money remittance service serving the Kenya community and a less popular Equity Virtual Banking which features ATM locations among other features.

 

Family Bank (Pesa Pap)

family-bank-kenya-mobile-banking-appFamily Bank is a financial organization that is built around the idea of family and is popular with social groups and communities. Their laid back mobile application developed by Craft Silicon is efficient for servicing utility bills from various service providers in Kenya. The application is available on the android platform for versions above 1.6. You can download from the Google Play Store here.

 

NIC Bank Kenya

NIC-Bank-Kenya-mobile-banking-appThe NIC Bank is not left out when it comes to serving up its clients with the latest innovation. Though basic, the mobile banking application offers everything a banking client is looking for including online merchants and mobile money options. The application is available on the android platform for versions above 1.6.

You can download from the Google Play Store here.

 

Kenya Commercial Bank (KCB)

kenya-commercial-bank-kcb-mobile-banking-appThough not hosted on the play or app store, KCB’s mobile application can be download on their website offering the ability for users to send money to their mobile money accounts such as M-Pesa, check their balance as well as transfer funds. The application compliments the USSD service accessible via *544# on Safaricom Lines.

You can download from their website here.

 

Chase Bank Kenya (Mfukoni)

chase-bank-kenya-limited-mobile-banking-appThe bank has an attractive mobile banking app known as mfukoni which translate in English from Swahili as ‘In the Pocket’. Othe than, the application has an attractive interface and goes beyond that to provide service beyond the usual mobile application. Mfukoni also provides access to services such as insurance and unit trusts that are a product offering by the modern financial institution. You can download from the Google Play Store here.

The have a separate application for tablet devices available for versions 3.1 and up.

Banking will remain a core primary service but sure, banking as we know it will continue to evolve decade after decade.

Leave a comment and don’t mind pointing us to any apps that might have been missed.