SPIRE BANK IS ON THE VERGE OF COLLAPSE

Mr Tim Gitonga, Spire Bank managing director decided to hand in his resignation letter as MD to the bank’s board  charlady Ms Teresa Mutegi after he realized that the lender may not be in a position to be saved

Mr Tim Gitonga Left) and Ms Teresa Mutegi (Right)

One of the smallest banks in Kenya could be on the verge of collapsing with millions of shillings in depositors’ savings. Spire Commercial Bank was only recently re-branded from Equatorial Commercial Bank after being acquired by one of Kenya’s largest Sacco.

The bank is facing serious liquidity problems and bad depts. It has failed to meet the Central Bank of Kenya minimum capital requirement of 1 Billion Shillings. The CBK recently disclosed in a statement that two banks violated the minimum capital requirement underlining the challenges facing banks funding large projects. It is suspected that one of the banks highlighted in the CBK statement is Spire bank.
 The Kenyan teachers’ majority owned lender Equatorial Commercial Bank (ECB) had re-branded to Spire Bank following acquisition by Mwalimu National Sacco. The bank is 75 per cent owned by the teachers Sacco. Mwalimu National acquired the stake in 2016 from businessman Naushad Merali who holds the remaining 25 per cent of the bank through his investment vehicle Sameer.


Mr Tim Gitonga, Spire Bank managing director decided to hand in his resignation letter as MD to the bank’s board  chairlady Ms Teresa Mutegi after he realized that the lender may not be in a position to be saved. He copied is resignation letter to the Central Bank of Kenya.

Mwalimu National Sacco, the major shareholder in the bank is itself mired in managerial squabbles. With only one year remaining for the current chair lady Ms Teresa Mutegi to step down. Some people within the board are working overtime for Ms. Mitegi to retain her roles at both the bank and at the Sacco even after her term expires, but the majority on the board wants her out.

The squabbles among board members led to the sacking of the former CEO at the Sacco Mr. Robert Shibutse. All these happenings at the bank have remained a secret that most of the staff is not even aware of. Interestingly the bank website is also down, just a sign that things are not well at the bank.