Kenya's authorities on Friday shut down a private bank accused of being involved in a major tax evasion.

The Central Bank of Kenya (CBK) said in a statement that it was closing down Charterhouse Bank, a privately owned bank, which this week faced accusations from lawmakers for helping Nakumatt, Kenya's largest retail chain, dodge millions of dollars in taxes, thus putting its main rival, Uchumi Supermarkets, in insolvency.

"In order to protect the interests of Charterhouse Bank Limited, its depositors and other creditors, the Central Bank of Kenya has today appointed a statutory manager," CBK Acting Governor Jacinta Mwatela said.

She said the private bank, with 10 branches located in Nairobi, Kisumu and Mombasa, would remain closed until further notice from the appointed manager.

The appointment of the statutory manager would be for a period not exceeding 12 months unless extended.

Early this week, opposition lawmakers tabled the central bank report, which said Nakumatt and six other firms had used Charterhouse to evade about 250 million U.S. dollars in tax.

But in a statement, the Charterhouse Bank denied the accusations.

"We want to reassure all our customers that there is nothing to worry about, because the Charterhouse Bank has not violated any law and does not conduct its business through the media," the bank said.

The Uchumi chain closed down on June 1, and its receiver manager announced a plan to sell it nearly two weeks later.

In 2001, the company borrowed 900 million shillings (12.4 million dollars) from the state-owned Kenya Commercial Bank and Preferential Trade Area Bank, but the loan did not boost its performance.

Source: Xinhua