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By George Obulutsa
NAIROBI, Nov 29 (Reuters) - Kenya's central bank hopes mid-size lender Chase Bank will be brought back out of receivership sometime during the first quarter of 2017, the governor said on Tuesday.
The Central Bank took over Chase Bank in April after a run on its deposits raised fears it would be unable to repay customers.
Chase was the third medium-to-small lender to be closed in Kenya over a period of nine months, rattling investors in East Africa's biggest economy, where the level of gross non-performing loans reported by banks rose sharply last year.
"Our expectation is sometime in Q1 of next year, we will bring this to fruition," Patrick Njoroge told a news conference.
In April, Njoroge said that he had received nine indications of interest in Chase Bank, including from the private bank's own shareholders and other local lenders or investors, as well as two foreign parties.
In the same month, Chase Bank reopened after KCB Group was appointed to manage it.
On Tuesday, Njoroge said there was interest from both foreign and local investors but did not elaborate apart from saying that they were looking at all possible ways of bringing Chase Bank out of receivership.
"Everything is on the table, so there is nothing that you can say is off the table, including even, just as an example, we haven't said the way to go forward would not include some equity conversions of deposits or equity conversions of loans."
Kenya's mid-sized Imperial Bank was taken over in October 2015 after fraud was uncovered. Two months earlier, smaller lender Dubai Bank was put into receivership. (Writing by Aaron Maasho; Editing by Mark Heinrich)