The contemptibly fraudulent process to desecrate Uganda’s only traditional glorious commercial bank, Crane bank, was finally concluded in January 2017.
A chain unprofessional elites in Bank of Uganda and some lawyers/liars saw this institution donated to DFCU bank at questionable credit of an incendiary 200 billion Uganda shillings, payable in instalments till 2020.
Veteran journalist, Andrew Mwenda puts it more aptly that, Crane bank was sold to dfcu for a song.
A genuine analysis of events culminating into the climax of the above clearly reveals attributes of visible collusion, ill intent to defraud proprietors and shareholders of Cbl, illegal transactions, corruption among others.
As a receiver and buyer, Bank of Uganda and DFCU bank entered into a purchase of assets and assumption of sales agreement respectively.
The agreement signed on 25th January 2017 and evidently signed by Emmanuel Tumusiime Mutebile-governor/ receiver and witnessed by Bank of Uganda’s secretary.
Also, Juma Kisaame signed on behalf of DFCU bank together with William Sekabembe, the bank’s executive director.
I must opine that these are very sober individuals but the contents of the agreement raise more questions than what meets the eye.
The deliberate sidelining of former crane shareholders, failure to state the value of liabilities or the value of assets taken over by DFCU, the takeover of a portfolio of bad loans of nearly 600 billion shillings for no payment at all, talking over of leases without the consent of a lease guarantor and failure to value CBL’s assets as per the market value prior to their transfer to DFCU bank among others.
For instance, in order perpetrate visible fraud against shareholders of Cbl,the agreement doesn’t state the amounts of money to be paid by DFCU as net purchase price .
Further still, it doesn’t bring out the terms of payment of monies that dfcu is supposed to pay to BOU! It is also silent on assets outside branches that the buyer was taking over.
How can an agreement even if basic, fail to state the purchase price and terms of payment?
The motives of PWC accountants is equally questionable as they undervalued cbl’s listed leases at 10 billion Uganda Shillings yet at the time of BOU’s takeover, cbl’s assets were worth 1.3 trillion shillings.
Such revelations betray the calibre of principle actors on both the side of BOU and DFCU bank to the extent that even a first year student of law would not draft such an agreement if not motivated by intentions to defraud shareholders.
Where is the role of legal advisors on both sides?
Worth noting is that, in any institution, the interests of shareholders (where applicable like in this case) are prime. The takeover of crane bank by BOU and later donation to dfcu didn’t in itself mean that shareholders ceased to have interests.
The sidelining of shareholder’s interests and input in the whole process cannot be over emphasized.
It should be recalled that even before takeover, BOU didn’t fully accord shareholders a listening ear to even recapitalize their bank.
This suspicious conduct grew and revealed itself in the agreement which only makes deliberate reference to the interests of creditors and depositors.
This is dubious for a receiver is legally and morally obliged to take care of shareholder’s interests as well.
Because of such conduct, dfcu is embroiled in a myriad of expensive suits.
The portfolio of bad loans. When BOU took over cbl, approximately 600 billion shillings were classified as non-performing loans and removed them from the list of assets.
Out of their share capital, crane bank’s shareholders were made to pay for the loans amounts totalling to Ugx.350 billion.
They additionally paid to BOU Ugx.85 billion in three additional shareholder payments.
For any person with knowledge of basic economics, it means that non-performing loans were not a property of crane bank but for the shareholders.
Secretly, the bad loans were transferred to DFCU bank with the permission of the embattled former director of supervision, Justine Bagyenda.
DFCU went ahead to recover these loans and share proceeds among DFCU and BOU officials!
How can a public institution allow such secret transactions?
The court battles on conflict of interest and fraudulent transfer of leases were just a tip of the iceberg! DFCU, BOU plus their double faced lawyers find themselves in yet another insurmountable episode of perpetrating fraud! Its just a time bomb. I encourage shareholders not to hesitate to seek for justice in this matter.
Kagenyi Lukka is a current affairs analyst, and an aspiring MP Ikiiki constituency.