Kenyan businessman, Ashok Doshi, has withdrawn his long-running lawsuit against the Central Bank of Kenya (CBK) challenging the liquidation of Imperial Bank, following an out-of-court settlement.
- •The legal battle centered on CBK’s 2021 appointment of the Kenya Deposit Insurance Corporation (KDIC) as liquidator of the bank which Doshi argued was unlawful because the receivership period had expired.
- •On the other hand, CBK argued that the receivership and deposit moratorium were still in effect, and the appointment complied with statutory procedures.
- •The High Court formally adopted the consent, marking the case withdrawn with no order for costs
In 2018, when the High Court ordered a fresh start after procedural disagreements. At that stage, Doshi was required to file a detailed statement and supporting documents, while CBK and Imperial Bank were to respond with relevant evidence. The case involved disputes over the production of original bank statements versus photocopies covering deposits exceeding KSh 920 million.
Doshi argued that CBK failed in its supervisory duties, allowing mismanagement at Imperial Bank to expose depositors to losses. Over time, the dispute evolved from a deposit recovery case into a broader challenge to the legal framework of bank liquidation.
By agreeing to settle out of court, the parties removed the risk of a precedent that might have undermined the regulator’s authority. A court ruling in Doshi's favor could have invalidated the liquidation, triggering claims from other depositors.
Imperial Bank collapsed in 2015 and is recorded as one of Kenya’s largest bank failures. The bank had engaged in long-running insider lending and mismanagement.
