Nairobi, Jan. 4 -- In the second quarter of 2016, Fidelity Commercial Bank was experiencing a worsening liquidity crisis.

The recent collapse of three institutions -Dubai Bank, Imperial Bank and Chase Bank- had eroded confidence in small lenders.

To address its liquidity crisis, Fidelity's directors started talks with Mauritius-based banking group SBM Holdings to have the latter acquire the Kenyan lender.

The negotiations culminated in SBM's buyout of Fidelity for Sh100 in a controversial transaction that is now before the High Court.

The legal battle will unravel the roles, claims and counterclaims by three key parties -SBM, former owners of Fidelity and the Central Bank of Kenya (CBK).

Details of the transaction remained a secret u...