Ex-Airports Sacco Officials Default on Millions in Loans

A report by the supervisory committee of the Airports Sacco has revealed that former top officials of the organization have defaulted on Sh49.99 million in loans, sparking concerns about the institution's credit risk management.

The report shows that the defaulted loans include Sh26.96 million owed by a former chief executive, Sh9.36 million owed by a former treasurer, and Sh2.44 million owed by a former chairman. Other former staff members have defaulted on an additional Sh11.21 million in loans.

According to the report, no amount has been recovered from the former staff members in the year ended December 2025, and the committee has warned that the continued delay in recovering the loans exposes the sacco to significant financial loss and erosion of members' funds.

Recovery Efforts

The Airports Sacco has reported the former officials to the Co-operative Tribunal in an effort to recover the amount. The supervisory committee has also recommended exploring additional legal and recovery mechanisms and providing periodic progress reports to members on the status of recovery efforts.

The report also notes that current staff members have borrowed Sh50.04 million, with the loans performing and fully guaranteed. However, the committee has observed that some staff members have tapped loans with a maturity period beyond their retirement age or contractual period, raising fears of a future wave of defaults when they exit.

The committee has recommended that the sacco's board and management strengthen credit risk management and loan structuring policies to ensure repayment periods are aligned with retirement age, employment tenure, and borrowers' repayment capacity.

The Sacco Societies Act allows saccos to grant loans to their employees and board members on condition that the terms are the same as those applied to members. The rules bar the employees or directors from participating in the approval process or being guarantors.