Crane Bank Was Sold on a None Cash Sum of 200bn Shillings.Investigations

By Fred Kajubi

The parliamentary committee investigating closure of seven defunct commercial banks has found out that Crane bank limited was sold on a none cash sum of 200bn shillings to Dfcu to be paid in installments for 30 months without attaching interests. Committee members have equated this sale to a donation which BoU offered to Dfcu Bank

Members on the parliamentary committee of commissions statutory authorities and state enterprises got shocked to find-out that bank of Uganda as as a statutory manager at crane bank limited sold of properties of the defunct bank without an evaluation report. BoU officials instead relied on the due diligence done by Dfcu bank which bought the entity afterwards 

Members have also faulted central bank officials for selling off the loan portfolio of crane bank which was worthy 500bn at the time of closure to Dfcu bank at 200bn shilling  in installments without attaching interests and putting its treasury bills as the only security . At a moment Dfcu has only paid 98 billions which angered legislators. But the central bank board of governors told the committee that they acknowledged the anomaly and the management noted that interests where to be levied on share holders of crane bank which the committee objected claiming its illegal and irregular 

It was also discovered that in only three months when Crane Bank was under statutory management of BoU the bad book which comprise of bad loans and high risk assets increased at 73% from 238 billions at the closure to 570 billions but the former BoU statutory manager Edward Katimbo Mugwanya fumbled and failed to convince the committee on the cause which left members wondering the kind of management BoU  extended to crane bank. Members also questioned the monthly payment of Katimbo Mugwanya  during his statutory management at defunct bank  of 10000 dollars per month which they claimed that was too huge to be paid by a struggling entity and may have been the reason that depleted the bank .

The former executive director supervision Justine Bagyenda whose passports were confiscated by parliament, has asked the committee to give back her passports to enable her prepare for a Christmas break abroad. the committee got suspicious to the prayer and the chairperson Abudu Katuntu promised to think twice before giving back passports to a witness whose presence to the committee is required  until the probe disposed off