President Museveni

To clean the mess that has engulfed Bank of Uganda (BoU), President Yoweri Museveni has reportedly directed auditing firm Ernst & Young (EY) to restructure the regulator of the country’s banking industry so as to restore public confidence, Eagle Online can reveal.

According to sources, EY will work alongside the BoU Governor Emmanuel Tumusiime-Mutebile to reorganize the institution in the process that will usher in sweeping changes in the bank’s human resource recruitment as well as modification in the organizational structure.

Tumusiime-Mutebile is expected to retire at the end of the exercise that should scare top officials at the institution that needs overhauling as soon as possible given the COSASE report which pointed out for example the separation of the management role from the supervision role that is played by the board directors. Tumusiime-Mutebile and his deputy Dr Louis Kasekende are Chair and Vice Chair of the board respectively, an arrangement MPs said causes conflict of interest.

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Sources say Museveni’s decision is a result of the recent probe by parliament’s Committee on Commissions, State Authorities and State Enterprises (COSASE) probe and report on BoU which exposed the rot in the central bank whereby senior officials were accused of running the affairs of the bank as if they were running their own enterprises.

Particularly BoU top officials were accused of doing work for instance in the closure of seven banks between 1993 and October 20, 2017 without keeping records such as minutes of meetings, quarterly evaluation reports for the liquidated banks, ledgers as well as other documents.

All the directors from supervision department, banking department, legal department, archives as well as security department showed signs of incompetence as they could tell former COSASE let by Abdu Katuntu on the whereabouts of key documents related to the closure of banks such as Teefe Trust Bank, Greenland Bank, International Credit Bank, Cooperative Bank, National Bank of Commerce, Global Trust Bank and Crane Bank Limited.

Meanwhile, a source says Museveni has asked the Minister of Finance to look for suitable individuals for appointment as Board of Directors of BoU but this will require the amendment of the Constitution and BoU Act which say the Governor and his deputy must lead the Board. As such the ministry has been ordered to draft amendments of the Constitution, BoU Act and Financial Institutions Act.

It is said Museveni is also interested in having changes at the Ministry of Finance, following evidence that it did not supervise BoU to the extent that the ministry never received any reports on the closure of banks.

Cabinet is expected to discuss COSASE report after parliament makes final recommendations to government.

A source said Museveni is not happy with the events at BoU and would want officials who gained from the closure of banks to be punished.

Some of the BoU staff expected to lose their jobs include; Ben Sekabira (Director Financial Markets Development Coordination), Margaret Kasule (legal counsel), Kasekende.