Banking securities

Our Firm has extensive experience in advising financial and lending institutions in Kenya on a number of issues relating to banking securities. We appreciate that banks need to ensure that their lending is secure through proper security documentation.

We advise on review of securities, drafting bank security documents such as debentures, mortgages, charges, Chattels Mortgages and registration of the same with the relevant Government Registries and authorities. Our experience includes the following areas:

  • Real estate finance
  • Secured and unsecured lending
  • Asset finance
  • Project finance

Our banking and finance experience includes:

  • Drafting new laws for the government of Somaliland in the financial sector including a new Central Bank Act, Islamic Banking Act, Anti-Money Laundering Act, Money Remittance Act and National Payment Systems Act.
  • Acting for the State Bank of Mauritius, a Mauritian banking group listed on the stock exchange of Mauritius, in connection with its take-over and rescue of Fidelity Commercial Bank (FCB), a Kenyan bank in financial distress. Our role included undertaking a due diligence on FCB and its operations, drafting and negotiating a share purchase agreement in respect of an offer to purchase shares from the 43 shareholders of FCB, drafting and negotiating side deeds of indemnity from the major shareholders, initiating and running an offer to shareholders scattered across the globe, procuring signatures from the majority of the shareholders and issuing and running a statutory squeeze-out process.  In addition, we obtained all requisite regulatory approvals from the Central Bank of Kenya, the Competition Authority of Kenya and the COMESA Competition Commission on an expedited basis, obtained the requisite approvals and fit and proper certification for shareholders, directors and senior managers of the State Bank of Mauritius and successfully ran a complex multi-jurisdictional completion as a result of the diverse jurisdictions of the purchaser and sellers. This is the first time that a ‘Squeeze-Out’ under the new Companies Act in Kenya has ever been used in order to acquire shares under minority shareholders who did not accept offers from SBM. Further, the proposed acquisition will mark the entry of SBM Group into Kenya’s banking sector. SBM Group will bring its experience and expertise from Mauritius and other markets to enhance competitiveness and the resilience of Kenya’s banking sector. SBM Group is pursuing an international expansion strategy, and for the African region, it is anchored on Kenya as the entry point for Eastern Africa.
  • Acting for National Bank of Kenya, in connection with a banking facilities to Emergency Plus Medical Services, an emergency medical service provider that is a subsidiary of Kenya Red Cross, of USD 3.5 million and Guarantees from the Kenya Red Cross, including reviewing of the constitutional documents of the borrower which is a subsidiary of the Kenya Red Cross Society, drafting of the banking security documents for National Bank of Kenya, dealing with the Company Secretary of Emergency Plus Medical Services and ensuring the passing of the necessary resolutions in connection with the obtaining of the banking facilities. Kenya Red Cross is an institution governed by its own Charter and Statute in Kenya and it has unique provisions to the manner it can operate. The issuance of a cross-guarantee by the Kenya Red Cross Society to secure the facilities to its subsidiary (Emergency Plus Medical Services) involved complex procedural steps to be attended.
  • Advising several commercial banks on lending to both corporate and individual clients, preparing the security documents and overseeing the perfection of the securities in favour of the bank.