Chairman Ruparelia Group of companies and former majority shareholders, Sudhir Ruparelia and other shareholders before COSASE.

Former owners of defunct Crane Bank Limited (CBL) have demanded for an independent audit their bank and Bank of Uganda to account for Shs478 billion spent as liquidity support before controversially selling it at Shs200 billion to its rival Dfcu Bank on January 25, 2017.

They said BoU has failed to present documented evidence on where the money came from, how it was used and on which account it was deposited. According to BoU, the said money was used as liquidity support to CBL as well as other costs during the takeover.

In the event that Central Bank intervenes in the failed bank, Section 93 of the FIA 2004 guides that all costs of management by the Central Bank shall be payable by the financial institution and shall be a debt due from the financial institutions to the central bank.

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The former shareholders led by their Chairman Joseph Biribwonwa and his Vice Sudhir Ruparelia, told MPs on parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) on Wednesday that BoU officials led by the former executive director of supervision Justine Bagyenda, were more interested in selling CBL than saving it as lender of last resort.

Biribwonwa said BoU closed CBL at the time when they were in serious discussions with strategic investors who were willing to put capital in the bank. BoU closed CBL on account of being undercapitalised, a situation officials said put depositors’ money at risk.

Biribwonwa said CBL’s total assets helped DFCU Bank to grow its assets from Shs1.8 trillion to three trillion Shillings, which was an increase of 67 percent. He wondered why BoU could transfer CBL assets to Dfcu Bank at Shs200 billion interest free yet it denied CBL financial support to remain in business.

CBL opened its doors in Uganda in 1995, growing from one branch to 46 branches spread countrywide as well as spreading into Rwanda.

CBL shareholders also want BoU to refund US$8 billion they gave to BoU as capital contribution.

They were also bitter that BoU paid 914 million to MMAKS Advocates for advice on sale of CBL assets and assumption of liabilities as well as paying them commission of Shs3 billion being 5 percent of monies recovered them as CBL shareholders. BoU wants the shareholders to cover the cost incurred by BoU. But they said it is unfair and won’t respond pay the money they see as exorbitant.

They also told the committee that Dfcu Bank made a profit of Shs39.7 billion on the first day it acquired CBL yet BoU claimed it was insolvent.

The former shareholders particularly Sudhir Ruparelia also disputed Shs570 billion passed to Dfcu Bank written off loans even as it was not included in the purchase and assumption of assets agreement.

CBL presented their case to the MPs in the presence of Dfcu Bank’s Chairman, jimmy Mugerwa and former Managing Director Juma Kisaame among other officials who were also expected to defend themselves.