Court Clears Equity Bank to Auction Former Chase Bank HQ in Sh1.3 Billion Debt Case

Equity Bank Limited has secured clearance from the Court of Appeal to proceed with the auction of the former Chase Bank HQ in Nairobi, after judges dismissed an attempt to block the sale of the Riverside Office Block.

The lender is seeking to recover a $9.5 million loan, equivalent to more than Sh1.3 billion, extended to Riverside Mews Limited in 2012.

The facility, which was later restructured, went into default, triggering statutory notices and the initiation of recovery proceedings. The property, located on Riverside Drive, serves as both security for the loan and as an income-generating asset pledged to the bank.

Court Upholds Statutory Power of Sale

In its ruling, the appellate court held that Equity Bank, as a tier-one lender, is capable of compensating any party should a future appeal succeed. The judges also noted that delaying the auction could lead to further interest accumulation, potentially pushing the total exposure beyond the value of the property.

The decision affirms the lender’s statutory power of sale, allowing the public auction process to move forward in a bid to recover the outstanding debt.

The dispute had been brought by Kenya Deposit Insurance Corporation (KDIC), which is overseeing the liquidation of Chase Bank. KDIC argued that the Riverside property should be preserved, alleging it was acquired using misappropriated depositor funds.

The court, however, found that the existence of an arguable appeal was not sufficient grounds to halt enforcement, particularly where the lender could be compensated if necessary.

Chase Bank, now under liquidation, has been undergoing asset recovery processes aimed at settling obligations and addressing creditor claims. The Riverside Drive building represents one of the high-value properties linked to the former lender’s collapse.

The ruling adds clarity to ongoing disputes involving charged assets held as security by commercial banks, reinforcing the legal framework that governs recovery actions when borrowers default.

The decision comes amid a series of aggressive debt recovery actions by Equity Bank in early 2026:

• Mary Wambui (Glee Hotel) — Challenging an auction tied to an Sh8 billion debt as of January 2026.
• Moses Kuria — The High Court cleared the auction of his Kiambu properties over an Sh54 million obligation.
• Paddy Kenya — Received clearance for the auction of 30 vehicles to recover $2.34 million (over Sh300 million).

Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.