Cosase probe: Bagyenda forced Crane bank to buy NBC

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Bagyenda

By Kagenyi Lukka

On Monday 4th February 2019,Parliament’s committee on commissions, statutory authorities and state enterprises (Cosase) chaired by Bugweri county legislator, Abdu Katuntu met with former shareholders of the defunct former National Bank of Commerce (NBC) who gave their   position on the closure of their bank.

National Bank of Commerce was owned by among others; Former Premier, Amama Mbabazi, Ruhakana Rugunda, Amos Nzeyi, Prof Emmanuel Tumusiime Mutebile, Mathew Rukikaire and retired Supreme Court Judge, Kanyeihamba.

Nbc had been rocked by wrangles between majority and minority shareholders which grossly bogged down the bank as sufficient capital couldn’t be raised to keep it afloat, sources revealed.

Nbc was on instructions and near force from Justine Bagyenda, closed in 2012.

According to the Purchase of assets and assumption of liabilities dated 27th September 2012 between the liquidator (Bank of Uganda) and the purchaser, Crane bank Limited, Justine Bagyenda former EDS signed as the acting governor while George W Nyeko was BoU’s legal secretary.

Article 2.1 of the P&A agreement requires the purchaser, crane bank to pay accrued interest on liabilities.

Further still, Article 3, Bagyenda agreed to sell or transfer assets to crane bank, and further committed to execute a transfer deed in favor of crane bank, handover of the certificate of title to the purchaser with in 45 days of payment date.

It was therefore the obligation of cbl to reopen and provide banking services to clients at nbc branches in Kabale and Cargen house plot 13A Kampala road. And as stated in Article 6, Cbl would take over both branches.

Whereas crane bank, was essentially the buyer of nbc, the P&A reveals Bagyenda and her team took 65% of the proceeds realized from debt collection while cbl was only design ated as a collection agent as per Article 7.1 of the P&A.

Nbc had unsecured performing loans of Ug.Shs 499, 287, 894, Secured Non-Performing Loans of Ugx 338, 555, 840 and Unsecured Non-performing Loans of Ugx 676, 641, 667.This is according to annex C of the P&A agreement and cbl was required to collect the stated amounts as an agent.

All the above was crafted by Justine Bagyenda who called crane bank managers then to either accept and take over the struggling nbc or cbl would face dire consequences if it had refused. This was revealed by an internal source in cbl.

Crane bank was therefore forced to take up nbc with all its troubles to avoid facing the high handedness of Justine Bagyenda.

Lukka.kagenyi@gmail.com

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