Citibank N.A. Kenya, corrects erroneous comments related to its role as Lead Receiving Bank in Safaricom Initial Public Offering (IPO)

Citi disputes the erroneous reports related to its role as Lead Receiving Bank during the landmark IPO of Safaricom, clarifying previous inaccurate statements by industry participants concerning the delivery of refunds and the reconciliation process with brokers.

According to Citi, the delivery of refunds was strictly in accordance with the instructions received from the Government of Kenya through the various agencies that were involved in the IPO.

These instructions were to issue payments directly to all applicants and, according to the prospectus, the preferred method of refund was through electronic transfers directly to applicants' bank accounts.

If bank account details were not available, a default refund cheque was to be issued.

Complaints have also been received from some investors to the effect that they were forced and/or coerced to fill certain forms mandating some brokers to deal in the refund cheques with the help of some commercial banks. In yet other cases, some brokers transacted in refund cheques without the express authority of the investors, the Central Bank of Kenya is investigating this matter.

With regard to the reconciliation with brokers, Citi has undertaken the process of reconciliation in a meticulous and conscientious manner and has maintained an open door policy for brokers to present all outstanding issues. It should be noted that all brokers have duly signed the reconciliation certificates attesting to the completeness
of the reconciliation process between themselves and Citi. This was also a pre¬condition to payment of commissions to selling agents by the Government of Kenya. All commissions have since been paid by the Government of Kenya.

Citi has also undertaken additional actions to assist in addressing queries and issues raised by brokers after the closure of the IPO, including numerous communication and requests of meetings with the brokers to address any remaining issues.

Citi, in full coordination with the Central Bank of Kenya, the Capital Markets Authority, the Investment Secretary and the Privatisation Commission, has worked around the clock to ensure that the performance of the market was not compromised, that the IPO would be a resounding success and that all issues arising from a transaction of this scale would be amicably resolved and the integrity of our markets assured.

Citi takes great exception to erroneous comments made by disparate brokers and/or their representatives at various fora which misrepresented the process undertaken by Citi in its role as Lead Receiving Bank and reserves its rights thereto.

For further information, please contact:

Ade Ayeyemi,
Managing Director, East Africa

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