The Central Bank of Kenya (CBK) has put Chase Bank under receivership for 12 months due to what the regulator termed as unsafe financial conditions.

The regulator said the appointment of a receiver manager has been been done in the interest of depositors, creditors and the public.

“Chase Bank experienced liquidity difficulties following inaccurate social media reports and stepping aside of two directors, consequently it was not able to meet its financial obligations on April 6, 2016,” CBK said in a press statement on Thursday.

“In light of the above, CBK has appointed the Kenya Deposit Insurance Corporation to assume the management, control and conduct of the affairs and business of the institution,” the authority said.

Chase Bank chairman Mr Zafrullah Khan and group managing director Mr Duncan Kabui Wednesday stepped aside following concerns over the credibility of the bank’s financials.

The lender on Wednesday restated its financial results showing it had under-reported insider loans by a whopping Sh8 billion.

The restated financial results published showed that insider loans — money advanced to directors, shareholders, associates and employees of the bank — stood at Sh13.62 billion last year against the Sh5.72 billion it reported on March 31.

“The above statements and disclosures are extracts of the bank’s financials as audited by Deloitte and Touche and received a qualified opinion,” the bank said in the footnotes of its financials, meaning the information provided to auditors was limited in scope.