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UPDATE 1-Kenya issues licence to shariah-compliant DIB Bank, first since 2015
April 28, 2017 / 6:20 AM / 8 months ago

UPDATE 1-Kenya issues licence to shariah-compliant DIB Bank, first since 2015

(Adds details, background)

By George Obulutsa

NAIROBI, April 28 (Reuters) - Kenya’s central bank has issued a licence to DIB Bank Kenya Ltd, which is owned by United Arab Emirates-based Dubai Islamic Bank, the first by the central bank since 2015, when it placed a moratorium on approving new banks.

The move announced on Friday will make DIB Bank Kenya the third fully shariah-compliant lender in the to operate in the east African nation, the central bank said.

“DIB intends to exclusively offer shariah-compliant banking services in Kenya,” the Central Bank of Kenya said in a statement. “DIB’s entry will expand the offerings in the market, particularly in the nascent shariah-compliant banking niche.”

Dubai Islamic Bank PJSC also holds stakes in banks in Pakistan, Sudan, Jordan, Bosnia and Indonesia. Other fully shariah-compliant institutions in Kenya are Gulf African Bank Limited and First Community Bank.

“DIB PJSC’s entry into Kenya is anchored on its strategic focus of enhancing its international presence,” the central bank said.

In March, the central bank said in addition to DIB Bank, it was finalising the licensing of Mayfair Bank, which is owned by Kenyan investors. At the time it said both banks had received “approval in principle” before the 2015 suspension of licensing.

When it issued the moratorium for licensing new banks, the central bank gave no reason for its action.

But the moratorium came after it had placed privately-owned Imperial Bank under receivership in October 2015. Imperial’s board had alerted the central bank to malpractices at the mid-sized lender. (Editing by Alexander Smith)

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