Dfcu top executive in panic over Cosase appearance

Reports coming in indicate that Dfcu Bank’s Chairman board of directors, Jimmy Mugerwa and outgoing Managing Director, Juma Kisaame, are afraid of appearing before parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) which has started quizzing Bank of Uganda (BoU) top officials over seven defunct banks, including Global Trust Bank and Crane Bank (CBL) which Dfcu Bank bought.

Cosase’s decision to call BoU top officials for answers follows the August 27th release of the Auditor General’s special audit of BoU on seven commercial banks. The investigation of BoU was ordered by the same committee, following outcries by some of the former owners of the defunct banks.

Among others, Cosase is mandated to ex­am­ine the re­ports and au­dited ac­counts of statu­tory au­thor­i­ties, cor­po­ra­tions and pub­lic en­ter­prises and in the con­text of their au­ton­omy and ef­fi­ciency, as­cer­tain whether their op­er­a­tions are be­ing man­aged in ac­cor­dance with the re­quired com­pe­tence and where ap­plic­a­ble, in ac­cor­dance with sound busi­ness prin­ci­ples and pru­dent com­mer­cial prac­tices.

In his report, the Auditor General John Muwanga pointed out that not all principles/guidelines and regulations were followed as BoU transferred the assets and liabilities of Global Trust Bank and CBL DFCU Bank, as well as other dealing that saw other banks like Teefe Bank, International Credit Bank Limited, Greenland Bank, The Cooperative Bank and National Bank of Commerce liquidated and sold off.

Inside sources say Mugerwa is planning to fly out of the country in a bid to avoid appearing before the committee that has started its work by first calling BoU Governor Prof. Emmanuel Tumusiime-Mutebile and his deputy Dr Louis Kasekende. Tumusiime-Mutebile and Kasekende are also BoU’s board chairman and Vice Chairman, respectively.

The committee intends to call other individuals including other top officials from BoU, shareholders of defunct banks as well as the board members and managers of DFCU Bank to answer some queries as raised in the Auditor General’s report.

Meanwhile, Britain’s Commonwealth Development Corporation (CDC) Group, one of the corporate shareholders of Dfcu Bank has urged managers at DFCU Bank to desists from negative media publicity aimed at haunting former owners of one of the banks they bought at Shs200 billion, not cash, but paid in installments.