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Banks Takeover: BoU to Present Documents Next Week

The planned engagement between Bank of Uganda (BoU) officials led by Governor Tumusiime Mutebile and the Parliament Committee investigating the takeover of commercial banks flopped Wednesday, Chimp Corps report.

The MPs led by Abdu Katuntu needed more documents which Mutebile said he could submit early next week.

The investigation comes against the backdrop of the Auditor General’s report faulting the central bank on several issues regarding the manner in which the banks were taken over.

While the Auditor General concluded that BoU did not prepare a valuation of assets and liabilities of Crane Bank, it emerged that several audit reports were made after the takeover of the bank.

According to the audit reports, Crane Bank was found insolvent due to its largest shareholder Sudhir Ruparelia’s alleged insider lending, fraud and money laundering.

An audit report recommended the prosecution of Sudhir only to be saved by President during a meeting at State House Entebbe.

Museveni insisted that Sudhir pays back billions of shillings which BoU used to capitalise the troubled third largest bank in the country.

The Cosase probe has been so politicised with some speculating that some lawmakers were reportedly compromised to humiliate BoU staff.

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This is what transpired at Parliament today:

BOU team entered the committee room at 10:31am.

Mutebile took his seat at 10:43am and it was not until 10:47am that the meeting was called to order by Katuntu who had earlier arrived at 10:39am.

Katuntu: This process has attracted a lot of attention. It’s going to be handled in most professional manner. It’s going to be handled in a way that will not distract us and not affect us.

Please be accurate with your reporting, we aren’t hiding anything. It would be disservice to country if we do misrepresent these matters.

Cosase took a strategic decision at beginning of the term. Our process is to help the institution improve, work better. We want to be of value addition. We want a better institution. The more reason we have established that as practice we meet both Management and board because we have realised there is a disconnect. There is a public debate which is good for the bank and sector.

Get comfortable that this is a legitimate process and we also know the sensitivity of this institution to the economy and business at the end of the day. Can we do things according to the law?

10:53AM: Katuntu: There isn’t a single document attached to the responses. We are going to consider these Banks in order from the Bank that was closed first.

Greenland 1st April, Cooperative Bank… so we are going to take them in that order. I see a lot of misconception that this process is about a particular Bank. We need preparation of documents related to each Bank.

The objective of this process is to see if any Bank could be handled better and I am sure the current Banks would be interested in this process. Will our institution handle it better in accordance with the law?

Many of these people who own these banks want accountability so we need accountability.

We are conscious of your constitutional independence…

Independence doesn’t mean non-accountability. We know BoU is independent but accountability is a constitutional requirement. What we are looking for is accountability not criminal prosecution. In case there is anything we think falls within mandate of other institutions, then we shall refer. There is no criminality that’s going to be discussed here.

Mbabali: 11:15am: We should debate in closed doors to avoid speculation.

Order

Katuntu: Parliament is an open place. It would be wrong that we are going to hide somewhere and discuss issues of national importance. But it is wrong to start from premises to close these proceeding and it will lead to speculation…

Kasibante: Responses lack attachment.

Katuntu: Members we need to take this process seriously, read documents and internalise. What we would want is provide 35 copies then have time to analyse the report. We don’t have all time; the tenure of standing committee ends. We need to finish so it doesn’t spill over to others. Whoever comes, this business has to be finished. We need the report debated in time so Parliament takes a decision.

 

Mutebile: We will try provide documents to answer questions.

Egesa: We have carried work copy of most documents and will make copies for the MPs.

Katuntu: It is no use to carry the documents and have it there. Carry all documents that are necessary or supportive of all responses. Minutes of Board in relation to subject under discussion.

Byandala: Documents don’t contain what I want.

Okupa: Reports on all Banks closed at time of closure. International Credit Bank, Global Trust Bank, Teeffe Bank, Crane Bank, National Bank of Commerce, Cooperative Bank, Green Land Bank, etc.

Mutebile: We will make remarks.

Katuntu: Can we have documents supporting your responses?

Mutebile: It is quite impossible to reply to these demands within a day. We need a couple of days. Do we provide evidence of passing over?

Katuntu: All documents. We are now re-examining these documents. We said a day because you said you have them. You’re the ones who gave the impression

Mutebile: We submit on Monday afternoon

Katuntu: I don’t want impression that we are rushing anything. We will meet on Wednesday.

Byandala: Photocopying takes three days, how do you expect us to read all these volumes within two days?

Katuntu: Can we have the documents by close of business on Monday? It isn’t post-mortem, it is accountability. Let us go through this process so that if there is any problem with Bank is done in a different way. Meeting adjourned Friday 10:00am.

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