Riggs Bank will pay a $16 million fine (1.3 billion shillings) to avoid being prosecuted for failing to monitor suspicious financial transactions. The settlement will enable the Bank to complete a merger with PNF financial services, but will also sacrifice Kenyan banker Simon Kareri in the process. “Riggs will continue to cooperate with investigators as they pursue some former executives, and the agreement allows federal prosecutors to bring separate criminal charges against them.” The agreement will include descriptions of several transactions involving Equatorial Guinea (Kareri’s portfolio) and officials of that West African country, including its president, a dictator accused by human rights advocates of pocketing much of that nation’s $500 million a year in oil revenue, sources said.
The guilty plea is a rare one for a commercial bank. In recent cases of criminal settlements with the Department of Justice, banks have agreed to what is known as a deferred prosecution. That means the bank pays a fine but does not technically plead guilty — agreeing instead to certain facts that could result in a prosecution in a period of one or more years if the bank fails to make good on its commitments to clean up its act.
Following in the successful steps of Equity Bank, Family Finance Building Society announced plans to convert into a bank. They have a customer base of 60,000 and 12 branches, and will become the third microfinance institution after Equity and K-Rep to become a full commercial bank.
The European Investment Bank will open a regional representation office in Nairobi by April 2005. It will be third such office on the continent, after Senegal and South Africa, and will serve East and & Central Africa – giving potential investors a point of contact and advice on EIB operations and financing availability within the region.
Standard Chartered Bank has raised its base-lending rate to 13.75%