CBK says America stalled JP Morgan entry

JP Morgan Chase & Company headquarters in New York. PHOTO | AFP 

By GEORGE NGIGI, gngigi@ke.nationmedia.com

JP Morgan Chase entry into Kenya was stalled by a lack of approvals from the American banking sector regulator, Central Bank of Kenya has disclosed.

JP Morgan had applied to enter Kenya through a representative office three years ago but has never received full approval. The US banking giant has said it will make a second attempt to set up in the country with an eye on large deals.

CBK said it granted the largest bank in United States an approval in principle pending clearance by its home regulator who has, however, not given a go-ahead.

“The approval was granted pending approval from its home regulator, the Comptroller of the Currency. To date, the home regulator’s approval has not been supplied,” said CBK in response to the Business Daily queries.

JP Morgan was this year ranked the third largest bank in the world by Financial Times-associated magazine The Banker. Its chief executive, Jamie Dimon, had said that the lender was planning to make a second attempt to enter the Kenyan market while accusing the regulators of thwarting their first effort.

“We were going to open in Kenya and Ghana two years ago but were not able to because the regulator said we can’t,” said Mr Dimon in an interview with Bloomberg TV two weeks ago.

“We are asked by our corporate customers why we are not there,” he added.

Entry of JP Morgan into Kenya would boost public confidence in a sector that has been shaken by closure of two banks due to corporate governance issues.

Mr Dimon said the bank would not play in the retail market but would concentrate on large institutions and the government.

“What we are going to do is bank multinationals going in, their biggest institutions and the government. We are not doing retail — I would rather low-risk,” he said.