Finance (20)

Bank, Telecom Firm Launch Straight2Bank Wallet Collections Service

Standard Chartered Bank and MTN Uganda Limited have signed an agreement to allow MTN Mobile Money collections for Corporate and Business clients directly into their Standard Chartered Bank accounts on a real time basis. This solution is dubbed Straight2Bank Wallet Collections and will be delivered through the Bank’s Straight2Bank electronic banking platform.

Mr. Albert R. Saltson, Standard Chartered Bank’s Chief Executive Officer while delivering his remarks commended the collaboration with MTN Uganda saying the service will enhance the Bank’s client proposition and ability to extend its world-class financial services to clients countrywide.

“One of our strategic aspirations as Standard Chartered Bank is to be the Main Digital Bank for our customers and this commitment is reaffirmed by the launch of the Straight2Bank Wallet Collections solution today.

We will continue to invest in technology to keep pace with local and global developments. As a result the Bank in the recent past set aside USD 1.5 billion to be invested in technology and processes upgrade globally over three years. 

As part of this journey, Standard Chartered Bank Uganda has invested in digital innovations such as; the upgrade of the online banking platform, Launch of the Mobile app, Introduction of mobile wallets, Cash Deposit Machines and the replacement of ATMs across our network.

Client centricity remains a core priority for the Bank as we continue to build on our expertise and capabilities to support clients in capturing the opportunities presented by the global move towards a cashless society.” Saltson said.

While addressing the guests, Mr. Wim Vanhelleputte, CEO of MTN Uganda said;

“Since inception, MTN Mobile Money has played a remarkable role in fostering financial inclusion in Uganda. Initially offering a platform for our customers to cash in and cash out, MTN Mobile Money’s service offering has undergone several modifications to include bills and taxes payment, purchase of goods and services, defied existing geographical borders to enable customers to send and receive money internationally in real time.

Just earlier this week, we launched a partnership with National Social Security Fund to enable millions of unbanked Ugandans remit their social security payments to the Fund to save for their future and a better retirement.”

Key features of Straight2Bank Wallet collections are:-

  • Enabling Corporate and Business clients to receive MTN Mobile Money payments directly into their bank account(s) on a real time basis.
  • Automatic, real time email notifications, along with online reporting
  • Risks associated with handling  cash payments are mitigated
  • Promoting financial inclusion

The Head of Transaction Banking at Standard Chartered Bank Uganda Mr. Keval Bid, added, “The Straight2Bank Wallet Collections solution is another way we are relieving some of the operational pressures of our corporate clients so they can focus more time and energy on running their core businesses more efficiently and profitably.  Standard Chartered currently provides cash management solutions for more than 900 companies in Uganda, with more than 70% of those companies using our award winning online portal, Straight2Bank.” 

In his closing remarks, Dr. Robin Kibuka, Board Chairman for Standard Chartered Bank Uganda thanked MTN Uganda for partnering with Standard Chartered Bank to increase access to financial services and ultimately contributing to Bank of Uganda’s goal of financial inclusion.

He added, “As the pioneers of Mobile Money in Uganda, you helped start a revolution that has increased the penetration of financial services. We are proud to be associated with you and recognise the tremendous contribution you continue to make towards Uganda’s economic growth and individual livelihoods.

To our dear customers, thank you for banking with us. We value your loyalty and pledge to continue innovating and developing solutions that guarantee value for both your businesses and individual growth.”

This service will significantly lower operating costs and risks associated with managing cash, shorten the debt collection period and ultimately help to boost efficiency in the working capital management for Standard Chartered’s corporate clients.


How Bank Of Uganda Failed Sudhir’s Efforts To Rescue Crane Bank

Bank of Uganda which by law is mandated to supervise, offer advice and ensure that commercial banks in Uganda run smoothly by giving them proper guidance sabotaged efforts to save Crane Bank from collapsing, a Written Statement of Defence filed by Kampala Associated Advocates representing businessman Sudhir Ruparelia the proprietor of the now defunct Crane Bank and Meera Investment reveal.

Ruparelia’s defence filing comes a few weeks after the Central Bank through Crane Bank dragged the businessman to court alleging that he fraudulently got money out of Crane Bank leading to its poor performance, loss of core capital and eventual collapsing. Ruparelia was the proprietor and face of Crane Bank. He was a substantial shareholder in the commercial bank.

Sudhir Says He Is Innocent

The Central Bank in their suit says Ruparelia siphoned about Shs400 billion and failed to remit over Shs56billion to NSSF. He is accused of illegally transferring Crane Bank properties to Meera Investment.  The Central Bank wants Ruparelia to repay this money with interest, return the properties on which Crane Bank branches sat and face criminal charges.

Ruparelia vehemently denies any wrong doing. The businessman blames Crane Bank poor performing and struggling to a bad economy which did not only hit Crane Bank but also other banks and other sectors.

“The first defendant (Sudhir Ruparelia) shall contend that at all material times he never breached his duties as a non-executive director and acted in the best commercial interests of the plaintiff,” the defence document reads in part.  

“The Non-Performing Loan ratio only grew substantially as a result of a significant slowed down in the economy, which affected business operation of large borrowers thus eroding the plaintiff's core capital, a situation that was experienced by other financial institutions in Uganda.”

“As a result of the slow-down in the business environment, and the property market, there was an increase in NPAs which resulted in the then Crane Bank becoming under-capitalised and necessitated an additional capital injection,”

“The plaintiff’s [Crane Bank] shareholders injected additional capital of $8million (about Shs30b) and the shareholders sought an equity investor and indeed found partners willing to capitalize the bank,” Ruparelia this did not materialize because Bank of Uganda was disinterested.

Ruparelia believes that the suit against him is intended ‘for the purpose of intimidating, humiliating and blackmailing’ him. He contends that this honourable court cannot lend its process to the blackmail which amounts to an abuse of the court process.

Given No Chance To Save Crane Bank

On the 20th day of October 2016 Bank of Uganda took over the management of Crane Bank alleging that it was undercapitalized and was a threat to the banking sector in the country. On the 20th day of January 2017 Bank of Uganda placed Crane Bank under receivership before a week later, on the 27 of January 2017, sold it to DFCU Bank at an undisclosed sum.

However, Ruparelia approached Bank of Uganda to settle the dispute and between 29 January and 20 March the parties held a series of meetings to amicably resolve the dispute. This led to the signing of Confidential Settlement and Release Agreement ("CSRA") which was binding on 20 March 2017.

Bank Of Uganda Betrays Sudhir

Key among the provisions of the Confidential Settlement and Release Agreement was that Bank of Uganda would not sue Ruparelia over the claims. As we all know a legal battle has been bestowed onto us. Now Ruparelia is accusing the Central Bank of breaching the agreement at a time he had started repaying some of the claimed money. He says he was cooperating.  

As indicated in the defence papers, cClause 7 of the CSRA provides that ‘each party agrees, on behalf of itself and on behalf of the related parties not to sue, commence, voluntarily aid in any way, procure, instigate, prosecute or cause to be commenced or prosecuted against any other party or its related parties any action, suit or other proceedings concerning the released claims, in Uganda or in any other jurisdiction’.

 “The defendants shall contend that, the instant suit was instituted for the purposes of intimidating, humiliating and blackmailing the defendants and shall further contend that, this hounrable court cannot lend its process to blackmail which amounts to an abuse of court process.”

Ruparelia started Crane Bank in 1995 at a time when the economy was in a mess and recovering from the 1980s political turmoil. He built it to become the fourth largest bank by asset worth Shs1.8 trillion.

At the time of putting it under receivership, he was working to beating the bad economic situation and turn it around by injecting in fresh capital. Bank of Uganda didn’t let him do it, they clamped him down.

Inconsistencies In Negotiations

As earlier noted, to save the situation, Ruparelia engaged Bank of Uganda to be allowed to save his bank. However court submission by Ruparelia’s team show that Bank of Uganda had other ideas or was not willing to play by the card.

“Sometime in January 2017, first defendants through his representatives Mr. Kakembo Katende and Mr. Azim Tharani attended a meeting at the offices of MMAKS Advocates together with Mr. Masembe Kanyerezi and David Mpanga. The purpose of this meeting was to share an alleged PWC forensic report indicating the alleged extraction of $80million.

“At the said meeting, Mr. Masembe and Mr. Mpanga declined to share the PWC forensic report but instead rang the PWC ‘auditor’ who allegedly made that allegation, put him on speaker phone and allowed only a few questions. The auditor confirmed on a speaker-phone that the $80million did not leave the plaintiff (Crane Bank) in this alleged transaction.

“The plaint contains excerpts of the report and from those excerpts the first defendant has been able to establish that the alleged forensic report is actually a draft document created by pwc on 13th November 2014.”

Sudhir Makes Demands

Ruparelia at the earliest opportunity seek for disclosure and discovery of all the operating costs that the receiver has incurred since the takeover of Crane Bank. He also demands for accountability from the receiver because none has been communicated which he says is a ‘total violation of the receiver's fiduciary obligations’.

He also seeks disclosure of all documents relating to the agreement between the receiver and DFCU bank and in particular the purchase price of the plaintiff's assets. Ruparelia also contends that ‘the plaintiff is estopped from raising any claims against him since he who comes to equity must do equity and come with clean hands’.

“The first defendant shall contend that he did not commit any frauds as alleged or at all and shall put the plaintiff to strict proof. The first defendant further denies any extraction of money from the plaintiff as alleged or at all and contends that he is not liable to refund or account for any monies as alleged by the plaintiff.”

Visa Announces Support Of New Global QR Code Payment

Early this week, Visa announced its support of the new global QR Code Payment Specifications from EMVCo, the global technical body that manages the EMV Specifications.

The specifications cover consumer-presented and merchant-presented QR code use cases for digital payment acceptance. QR Codes are two-dimensional machine-readable barcodes, used to facilitate mobile payments at the point-of-sale. 

Visa and the other EMVCo Members worked to develop these new globally interoperable EMV specifications. Visa has already successfully enabled the merchant-presented QR technology in 15 countries around the world, with India, Kenya and Nigeria currently live in market with both bank and merchant partners. 

“We’ve already seen tremendous progress towards adoption of standardized, interoperable QR code payment systems in the developing world,” said Sam Shrauger, SVP, Digital Products, Visa.

“We are working with governments and central banks in countries like India to develop and implement QR code payment solutions that provide the convenience and security that are synonymous with Visa and help the journey toward a cashless future.”  

Easy Implementation for Merchants

Visa has enabled the growth of merchant-presented QR code payments around the world with its innovative mobile payments solution, mVisa. mVisa allows consumers to pay for goods and services by scanning a QR code on a smart phone or entering a merchant number into their feature phones.

Payment goes straight from the consumer’s Visa account into the merchant’s account and provides real-time notification to both parties. mVisa is completely interoperable, meaning that the consumer and the merchant do not need to be customers of the same bank. This brings the same convenience, security and reliability provided by the trusted Visa brand. 

For merchants eager to harness of the power of QR code payments, the Visa Ready Program has adopted the interoperable QR standards to develop tools and capabilities which help easy generation and deployment of QR code merchants by banks, processors and merchant aggregators.

Once enrolled, merchants can freely accept payments from any country or bank given mVisa’s interoperability while trusting Visa will securely and efficiently process each transaction. 

QR Code Payments Driving a Cashless Future

As digital payments help continue a shift toward a cashless future, this new global specification is an important step that promotes interoperability and standardizes the fast growing ecosystem of QR code payments across the world. Already, 33 banks and more than 328,000 merchants across India, Kenya and Nigeria have adopted the interoperable standards as they accelerate their QR code digital payment programs. 

“mVisa enables successful completion of the transaction independent of the mobile operator service on both the consumer and the merchants phone, and the consumers and merchant’s banks” said Shrauger. “This addresses a major challenge with mobile money programs, and lets consumers and merchants choose their own bank or mobile operator.” 

Reserve Bank of India has encouraged the adoption of standardized QR code payments to provide access to low-cost, secure digital payments to millions of consumers and merchants. 

Working with our partners, Visa is converting both every day and recurring cash purchases to digital payments through direct integrations with supermarket chains and large utility billers.

By presenting dynamic QR codes to consumers that provide a seamless payment experience, billers such Tata Sky, Idea Cellular, Reliance Energy, Mahanagar Gas, as well as Pizza Hut and supermarket chains Nakumatt, Spar, Zucchini are bringing benefits of digital payments to millions of potential customers.

Visa intends to replicate this success in 12 other countries where mVisa has been enabled: Cambodia, Egypt, Ghana, Indonesia, Kazakhstan, Malaysia, Pakistan, Rwanda, Tanzania, Thailand, Uganda and Vietnam.



COURT DEFENCE: Sudhir Says He Did Not Commit Any Fraud As Alleged In Crane Bank Case

The battle lines are now drawn following a defense filed late Thursday by businessman Dr. Sudhir Ruparelia contesting the fraud charges brought against him by Bank of Uganda, also the nation’s central bank, which regulates and monitors operations of all commercial banks and other financial institutions in the country.

The central bank filed the case at the commercial court, claiming how Ruparelia allegedly fraudulently took a total of Ushs400Bn from his defunct Crane Bank. Arguably the most successful businessman in the country, Ruparelia created Crane Bank in 1995 going on to oversee the growth of one of the most profitable indigenous banks.

The tycoon has since tasked the central bank led by Governor Tumusiime Mutebile to prove the fraud charges they are talking about, saying what they filed in court are mere conjectures and idle talk that makes it impossible for him to file a meaningful defence.

“…the first defendant (Dr. Sudhir Ruparelia) shall contend that he did not commit any frauds as alleged or at all and shall put the plaintiff (Crane Bank/Bank of Uganda) to strict proof. The first defendant further denies any extraction of money from the plaintiff as alleged or at all and contends that he is not liable to refund or account for any monies as alleged by the plaintiff,” reads part of the Written Statement of Defence filed in court.

After studying the central bank’s case for close to two weeks, Ruparelia’s lawyers trading under the eminent Kampala Associated Advocates (KAA) has filed his defence on Thursday afternoon and that of Meera Investments under which the tycoon owns and runs hundreds of prime properties in the city center and beyond it.

The Kampala Associated Advocates in their defence say ‘Sudhir denies any fraudulent transfer of property under his direction or at all and further denies breach of any fiduciary duty’. Similarly, the second defendant, Meera Investment, denies ‘all the claims made’ and ‘contends that the plaintiff is not entitled to any of the reliefs claimed as alleged or at all’.

“The defendants shall aver that the plaintiff has no cause of action against them as alleged or at all,” the defence document states. It adds, “the defendants shall contend that the plaintiff has no locus standi to sue on the claims set out in the plaint and has cause of action against them.”

Ruparelia oversaw Crane Bank grow from a bank with one branch in 1995 to 46 operational branches in 2016; servicing over six hundred thousand customer at the time the BOU took over its management. During this time Crane Bank’s assets grew to Ushs1.8trillion as confirmed in the 2015 annual audited report by KPMG.

Crane Bank profits grew substantially year on year and maintained a stable and health portfolio of performing assets over the years, developments Bank of Uganda as regulators of the banking sector gave green lights. The commercial bank was employing more than 700 employees some of whom lost their jobs when the central bank sold it to dfcu.

In the defence document, it is stated that the Non-Performing Loan ratio only grew substantially as a result of a significant slowdown in the economy, which affected business operation of large borrowers thus eroding the Crane Bank’s core capital, a situation that was experienced by other financial institutions in Uganda.

Ruparelia who says he ran Crane Bank at an average operating cost of Ushs90billion as per year is tasking Bank of Uganda to disclose all the operating costs that the receiver has incurred since the takeover. The businessman is also tasking the central bank to disclose how much dfcu paid them before Crane Bank assets where transferred to them.

The case file has since been handed to the head of the commercial court Justice David Wangutusi to hear and dispose of.

A full report will be filled in the coming few hours.


Pru Dollar Provides Financial Security To Ugandan Families

Prudential Assurance Uganda Limited, a fully owned subsidiary of Prudential plc continues its mission to provide flexible and innovative products that promote the financial security among Ugandan families with the launch of Pru Dollar.

This product allows the customer to make monthly payments in U.S dollars for a period of 8-15 years. Whether a customer is planning for his or her child’s education, saving for a home or simply making sure their loved ones are protected, Pru Dollar hedges their savings against the risk of currency devaluation thereby preserving the value of their policy proceeds upon maturity. 

This product gives customers peace of mind that their loved ones are protected. If the customer passes away or gets permanently disabled, Prudential will immediately pay a 50 per cent lump-sum to the beneficiary and take over payments for the remaining period.

In addition, Prudential will pay out another 100% of the maturity benefit at the end of the agreed period. If no claimable event occurs, the guaranteed lump-sum (with any accrued bonuses) is paid to the insured at maturity.

The product acts as an investment plan where Prudential pools money with that of other policyholders and invests it in a range of carefully chosen assets. If the investments perform well, the customer shares in the profits via bonuses, which is declared each year and reinvested on their behalf.

Speaking at the launch recently, Arjun Mallik, CEO Prudential Uganda said “Our endeavour is to provide families with the protection and savings solutions they need to secure their financial futures, and the long-term opportunities for us in the Uganda life insurance market are immense.”

Matt Lilley, CEO of Prudential Africa added “Since we re-entered the market in 2015, our new business sales in Uganda have grown significantly from, so has the size of our team, and number of our active sales representatives. Prudential is committed to making long-term investments in Uganda so that we are able to bring the benefits of life insurance to many more people”

Speaking at the event, Sarah Mann, Deputy British High Commissioner said Prudential plc is a multinational company and one of the world’s leading life insurance brands.

NSSF Infrastructure Investment Gets Global Recognition

The National Social Security Fund (NSSF) Uganda won the Africa Pension Fund Infrastructure Investment Initiative of the Year Award, beating other top pension funds on the continent. 

The NSSF Chief Investments Officer, Gerald Paul Kasaato, received the award on behalf of the Fund during the Africa Investor Infrastructure Development Summit held in Durban, South Africa on Tuesday, 2 May 2017. 

The Fund was recognized along with other global pension funds as well as leading pension fund personalities, for efforts made so far and being made in investments in the infrastructure space. Managing Director Richard Byarugaba said that the award is another milestone for the Fund for its prudent, yet aggressive investment strategy. 

“We are glad that our investment efforts such as the upcoming UN Model Project, the Off taker project in Real Estate, contractor financing and our investment on PTA Bank to finance infrastructure have been recognised. As a Fund, we are delighted but not surprised by this award,” Byarugaba said. 

In November last year, the Fund made an additional investment of about Ushs59.4 billion in Umeme Limited, effectively increasing its stake in the company from 15.5% to 23%. The Fund also invested in PTA Bank, which predominantly supports infrastructure funding.  

“We have become a benchmark for the social security industry in the East Africa region and we are steadily climbing the ladder to the top on the African continent,” he added. 

Byarugaba said the Fund is committed to preserving and growing the value of its members’ savings, by paying a real rate of return above the 10 year inflation average, driven by an aggressive investment strategy within Uganda and East Africa. 

The Fund has over the last 5 years consistently surpassed its target on interest payment to its members. Last year, the Fund paid an interest rate of 12.3%, which was higher than the 10-year average rate of inflation rate of 8.6%. 

This is the second time that the Fund is recognised at a continental and global level for its investments. In 2015, the Fund won the African Pension Leadership Initiative of the Year Award for its diversification efforts in the equity space. 

Commenting on the award, CEO of Africa Investor Hubert Danso said for Africa to realise its economic potential, it is critical that long-term industries, such as infrastructure, energy and transport, provide the groundwork for private equity transaction growth and job creation in Africa. 

“We are therefore delighted to recognise the leading role that institutional investors and, more especially, international and domestic pension funds play in these transformative investments in Africa. We salute all the winners, both pension fund leaders and institutional institutions,” Danso said. 

Africa Investor Summit partners include the World Pensions Council, the Institutional Limited Partners Association, the African Pension Fund Network and the African Securities Exchanges Association, amongst other prestigious institutions.


Customers To Receive Prudential Bonus

Prudential Assurance Uganda Limited announced that customers will receive a bonus of 4 per cent for 2016 on their sum assured: A sum assured is a guaranteed amount paid at maturity or any other claimable event

The bonus applies to the following Prudential products: Pru Lifesaver, Pru Lifeplus and Pru EduSave. Which is an easy way for customers to save for their children’s education and protect the future of their loved ones. Prudential invests money in carefully chosen assets on behalf of customers, who receive a share of the profits as a bonus each year, provided they pay their premiums regularly.

Arjun Mallik, Chief Executive Officer Prudential Uganda, said: “As a business, we are focussed on helping our customers achieve their goals – be it saving for their children’s education through Pru Edusave or building a nest egg for the future and we will always deliver on promise.

“I urge all customers to pay premiums in time to ensure the financial future of their loved ones is always protected” He added This bonus will be awarded to all policyholders whose policies were active on their policy anniversary in 2016.


Is Bank Of Uganda Being Soft With Foreign Banks?

Before the dust raised by Bank of Uganda when it took over the management of Crane Bank for being undercapitalized, news that more banks will suffer the same fate emerged. The banks that were rumored to be clamped down include Cairo Bank, DFCU, Centenary, ABC Bank, Bank of Africa, Diamond Trust Bank and Eco Bank. Bank of Uganda has not come out to clarify on the rumor.

Bank of Uganda took over the management of Crane Bank last week days after defending the Ruparelia owned bank. The move caused a lot of uncertainty and debate in the public domain. Bank customers in the sector panicked fearing that they would lose their deposits. The move did not go down well with Crane Bank owners who described the decision by Bank of Uganda as malice. They say they were looking for an equity investor and the central was aware.

Bank of Uganda’s silence on the state of Cairo Bank, DFCU, Centenary, ABC Bank, United Bank of Africa, Bank of Africa, Diamond Trust Bank and Eco Bank majorly owned by foreign investors has been received with mixed feelings by some sections of the public.

They wonder why the central bank rushed to takeover Crane Bank, an indigenous bank, while foreign banks are equally struggling. Some banks, especially those owned by Nigerians are said to be not making even. They are reportedly making no money at all yet Bank of Uganda looks the other side.

Alfred Owino, a retired banker says that if Bank of Uganda wants a functioning banking sector, all banks that are undercapitalized must be dealt with in a manner that brings sanity in the sector. “It shouldn’t be selective action. International banks repatriate profits yet local banks like Crane Bank invest in the country.” Owino stated in an interview.

Christine Alupo, Director Communications at Bank of Uganda issued a statement on Monday saying the financial Sector is Stable, Sound and Resilient. She encouraged the public to continue conducting their banking business without panic.

But news that Cairo owned by Egyptians and United Bank of Africa owned by Nigerians are undercapitalized and face closure contradicts Bank of Uganda message. As long as such rumours continue to emerge the banking sector will face panic and further insecurity.

“Government of Uganda should be supporting local businesses. Bank of Uganda should be even more keen on foreign banks because at the end of the day, if the fail, they will pack up their banks and return wherever they came from and people will have lost their money. Bank of Uganda should go for them too.” Henry Isabirye, an economics tutor, said.

The Ugandan economy has been not faring well and to many pundits the strife affecting the banking sector doesn’t come as a surprise. High cost of credit has kept away borrowers. Those who borrowed are failing to pay back the loans. People don’t have money to save with banks. You cannot also rule out the impact caused by mobile money. People now prefer to save on their phones than go to the banking halls.

Crane Bank Saga: Bank Of Uganda Breeding Liquidity In Banking Sector

The banking sector in Uganda is poised to slumber into unprecedented liquidity if Bank of Uganda continues to witch-hunt commercial banks, a Crane Bank official said adding that the entire banking fraternity in the country is not doing well. He warned that the public should pay attention to their bankers because of them are worse off.

Bank of Uganda governor Emmanuel Tumusiime Mutebile on Thursday in a public notice announced that the central bank was taking over Crane bank because they are ‘significantly undercapitalised’ and ‘poses a systematic risk to the stability of the financial system’.

But the official at the affected bank emphasized that while they are have liquidity issues, the bank has assets, expertise to come of this distress. He revealed that Bank of Uganda has turned down all potential investors that the bank sought to inject equity in the bank which served Ugandans since 1995. The official doubted the motive of Bank of Uganda.

“This is not good for Crane Bank and the entire banking sector and the public should worry. We have been engaging Bank of Uganda and we have a plan to get where we where before. We are looking for an investor to recapitalize the bank but look where we are,” the official said.

“Bank of Uganda is creating panic in the banking industry and this will lead to liquidity because people will withdraw their money, they will stop depositing with banks and bank will have no money to lend or invest,” he added warningly.

Crane Bank founder Sudhir Ruparelia confirmed that they were in advanced stages of acquiring a potential investor. This revelation came in the wake of rumors that Sudhir was selling the bank. Despite confirming the negotiations, he said he was barred to reveal the name of investor by the non disclosure agreement he entered with said investor.

Bank of Uganda despite saying they had ‘not received any request from Crane Bank to approve a change in shareholding’, Christine Alupo, the Director of Communication at Bank of Uganda in a statement said shareholders of commercial banks have the option of selling shares to new investors as they deem appropriate.

‘However, any new investor in a commercial bank must satisfy the regulator that they are fit and proper. The BoU does not comment on any negotiations to sell shares in a bank while these negotiations are ongoing.” She explained.

“In line with the Financial Institutions Act 2004 (FIA 2004) as amended in 2016, if a commercial bank wishes to dispose of equity worth 5 percent or more of its shares, the sale must be approved by the Bank of Uganda.”

Experts like Hellen Nakuya who manages an investment firm in Kampala also explained that people will in the long run stop going to keep their money in the banks if Bank of Uganda continues to shut down banks. “What Bank of Uganda must do is to ensure that Crane Bank doesn’t close because people will lose their savings then they will fear dealing with banks,” Nakuya said.

“Bank of Uganda should rectify anything that is wrong at Crane Bank if there is any and give it back to the shareholders and continue to guide them. We don’t want to see a scenario that befell Greenland when people lost their money.” She added.

Bankers Association Looking At Taming Cost Of Credit In Uganda

In an effort to find a lasting solution to the high cost of credit in Uganda, commercial banks under their umbrella organization, Uganda Bankers Association (UBA) embarked on a series of consultative meetings with various stakeholders.

UBA kicked off the consultative process on October 3, 2016, by meeting Members of Parliament from the Parliament of Uganda and is scheduled to meet public, private sector, and civil society member organizations between October and December, 2016.

Commenting on the initiative, Mr. Wilbrod Humphreys Owor, the Executive Director UBA said, “Uganda Bankers Association is listening carefully to the various concerns and contributions being made on this subject because the current challenges impact all of us.

“We are confident that through this consultative process, we shall find good directions towards the challenges around the financial sector and wider economyand make good progress in not only addressing the issue of the cost of credit but also tackling the real underlying causes and dynamics behind the price of this commodity called money”

Mr. Fabian Kasi, the chairman UBA remarked: “I strongly believe that the approach we are taking will result into appropriate recommendations that we can adopt to overcome this challenge and ensure that there’s sustainability in the businesses we all do.

UBA comprises of 25 commercial banks and one development bank in Uganda. Its mandate is to promote a strong and vibrant banking sector, encourage good governance and best practices in banking as well as represent the professional and business interests of its members.

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