Katimbo Mugwanya

Centenary Bank has rejected former Bank of Uganda senior staff Edward Katimbo Mugwanya to sit on its board, following the MPs probe of BoU senior staff over the controversial sale of seven commercial banks which are now defunct.

The Auditor General John Muwanga in his special audit report of Bank of Uganda on defunct banks blamed its current and former staff of liquidating banks without producing reports related to the transactions. Katimbo Mugwanya is the key witness in the closure of the banks and when asked by MPs probing BoU staff to respond to Mr. Muwanga’s report, he has always failed provide convincing answers.

Mr. Mugwanya was both the liquidator of Crane Bank Limited (CBL) and Global Trust Bank Uganda Limited (GTBU) which were respectively sold to Dfcu Bank in January 2017 and July 2014. He worked closely a with another senior BoU staff Ben Sekabira, who was also liquidator of Greenland Bank, now defunct.

Katimbo and former BoU executive director for bank supervision Ms. Justine Bagyenda failed to convince MPs on Parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) on insolvency of CBL. They also failed to produce reports on the closure of the two banks.

BoU while exercising its powers under Section 87(3), 88(1) (a) & (b) of the Financial Institutions Act 2004, took over the management of Crane Bank Limited and claimed to have put Shs478 billion before selling it to Dfcu Bank at Shs200 billion, paid in installments. Then officials have failed to account for the money.

The­­­­­ main reason why the Bank of Uganda took over the management control of Crane Bank was because “it lacked sufficient capital and posed a systemic risk to the financial system.”