The founding member of defunct Crane Bank Limited, Dr. Sudhir Ruparelia, told parliamentary committee on Commissions, Statutory Authorities and State Enterprises (COSASE) that he wants his bank back, two years after it was taken over by Bank of Uganda in 2016 and later in 2017 sold to dfcu Bank for a paltry Shs200bn.
Dr. Ruparelia requested that the (Crane Bank) receivership be terminated to avoid a scenario where Crane Bank remains in perpetuity receivership like Greenland Bank and that the company should be returned to its shareholders. The businessman says the Crane Bank takeover was illegal, unfair and unprofessional.
Joseph Biribonwa, the chairman Ruparelia Group of Companies, the conglomerate which owned Crane Bank, faulted Bank of Uganda (BoU) for frustrating Crane Bank’s efforts to recapitalize including their efforts to bring strategic investors and borrow a loan from the Central Bank for recapitalization.
“BoU did not support but actively frustrated the efforts of Crane Bank shareholders to bring strategic investors. The Central Bank instead opted for a sale of assets and liabilities of Crane Bank. Buyers were invited to bid on 12th December 2016 and bids were closed on 20th December 2016,” Biribonwa said adding that BoU deliberately frustrated other bidders and preferentially selected Dfcu Bank as the buyer.
In his remarks to the committee, Dr. Ruparelia, who is the deputy chairperson of Ruparelia Group, wants BoU to return the bad book that was handed over to Dfcu that is valued at Shs570bn. Dr. Ruparelia also wants BoU to return all the money that they [shareholders] advanced to CBL as shareholder loans.
Dr. Ruparelia said that prior to taking over the shareholders lent CBL $8m and after the take over the shareholders remitted $15.5m to BoU bringing the total to $23.5m. “We want a market valuation to be conducted of the assets and liabilities that were sold to Dfcu because to date, no one knows the list and values of the assets and liabilities sold to Dfcu. Any excess value to the assets should be returned to CBL,” Sudhir said.
He added that at the time of the takeover, Dfcu got 46 branches, became the 3rd largest bank overnight and also got deposits worth Shs1.3trillion including 600,000 active accounts. The former Crane Bank boss also revealed that Dfcu assets increased by 67% after taking over Crane Bank having risen from the worth of Shs1.8trn to Shs3trn.
“As shareholders, we want accountability for the money that BoU claims to have injected into CBL. We also want the receivership to be terminated and the company (Crane Bank) should be returned to its shareholders,” Dr. Ruparelia said.