Mutebile to leave BoU at its weakest point after 18 years at helm

The Bank of Uganda (BoU) Governor Emmanuel Tumusiime Mutebile according to reliable sources is expected to retire within a month or two after serving that institution since January 1, 2001.

Mutebile is credited for his efforts that have stabilised the monetary policy of Uganda, with the central bank regarded as one of the best performing in Africa on that front.

However, as Mutebile prepares to retire, scandals that have happened at that institution are still fresh in the minds of Ugandans and as such they are worth highlighting with the hope that they might not reoccur given that he leaves behind disorgainsed managers as revealed a recent parliamentary probe.

Controversial closure of seven commercial banks

Much as by the time Mutebile was appointed BoU Governor some commercial banks like Teefe Trust Bank, Greenland Bank, International Credit Bank and Cooperative Bank had been closed, it also true that some banks like the National Bank of Commerce (NBC), Global Trust Bank Uganda (GTBU) and Crane Bank Limited were controversially closed during his tenure. Just like the banks closed before Mutebile came in, NBC, GTBU and CBL were shut down without following guidelines as provided for in the Financial Institutions Act 2004, according to the Auditor General’s special audit report of BoU on defunct banks, published on August 27, 2018.

Fighting the Auditor General

BoU also fought hard as officials there did not want the Auditor General John Muwanga to do the audit above as requested by parliament’s Committee on Commissions, State Authorities and State Enterprises (COSASE) then headed by MP Abdu Katuntu. Speaker of Parliament Rebecca Kadaga had to intervene before Mr. Muwanga could begin his job.

However, much as BoU bowed to Kadaga’s orders, they did not give Muwanga and his team of auditors all the documents needed to do a thorough audit, especially as regards CBL, Greenland Bank and GBTU, Greenland Bank, International Credit Bank and Cooperative Bank. This was also confirmed as COSASE probed the officials based on the same report. MPs chased BoU officials on several occasions out of parliament for lack crucial documents to do with closure of banks. Even some minutes of meetings were nowhere to be seen.

Questioning Shs478 billion put in CBL

The Auditor also put it correctly that BoU had failed to account for Shs478 billion the officials claimed was used to keep CBL afloat during the statutory receivership. According to the Auditor General, Shs320 billion is not accounted for. Interestingly CBL needed only Shs150 billion to remain afloat before it was closed and its assets handed over to Dfcu Bank at a paltry Shs200 billion, paid in installments. Interestingly also, BoU which received CBL and misused the money wanted CBL shareholders to pay it, a proposal that was quashed by COSASE saying that BoU was both the borrower and lender in the same deal.

Leading a team of disorgainsed managers

From the beginning of the COSASE probe in late October last year, it emerged that Mutebile was leading a team of disorgainsed managers who appeared to the committee without the necessary documents related to the closure and sale of banks. The probe established that BoU top officials were poor record keepers. They could not tell the Mps were documents were kept. They could also go ahead to contradict each other, something that irritated MPs. As such Mutebile’s supervisory role as the CEO of BoU were found to be wanting, as some officials seemed to have signed some agreements behind his back. The deals involving CBL and GTBU came out as examples.

Case against Sudhir and Meera Investments Limited

BoU controversially sued Sudhir and Meera fleeced CBL of Shs397 billion in alleged fraudulent transactions and transfers from CBL. However, in the counter claim Sudhir wants BoU to compensate him Shs28 billion for breach of contract. This case failed to be sorted out of court and the litigation in the commercial court is likely to take long, costing taxpayers huge sums of money.

Hiring of conflicted lawyers

Mutebile also failed to hire the right lawyers as he sued Sudhir and Meera Investments Limited. He failed to do due diligence to establish whether MMAKS Advocates and AF Mpanga Advocates had ever worked for Sudhir and Sudhir Group of companies. Failure to establish that fact meant that Ugandan taxpayers lost money as he hired the two firms which were later disqualified by court to represent BoU. Mutebile would later opt for Sebalu and Lule Advocates in another case involving Sudhir, Meera Investments, DFCU Bank and BoU. Court would also disqualify Sebalu and Lule Advocates from the case since the law firm ever worked for Sudhir, meaning BoU here also wasted taxpayers’ money. After that mess BoU has finally decided to recruit Joseph Byamugisha as its Attorney.

Transfer of Meera Investments’ freehold properties to Dfcu Bank

Mutebile as BoU boss led the illegal transfer of Meera Investments, freehold property to DFCU Bank after gifting the latter with CBL assets at only Shs200 billion. CBL was by then operating in some branches that belonged to Meera Investments Limited, yet BoU never considered this serious. It allowed DFCU Bank to operate in those branches for 34 months, and BoU added DFCU Bank more 24 months after the first 34 months expired. Meera Investments in demanding return of its properties and about US8 million in rent arrears, according to the suit in court. Meera further accused DFCU Bank of fraudulently transferring its properties into its names.

Clash with IGG over Bagyenda sacking

In early 2018 Mutebile controversially sacked the Executive Director in charge of Supervision, Justine Bagyenda without giving clear reasons. He would replace her with the then Uganda Communications Commission (UCC) Director Industry Affairs and Content (Economic Affairs), Dr Tumubweine Twinemanzi, which forced Bagyenda to seek the intervention of IGG Justice Irene Mulyagonja who recommended that Mutebile reverses his decision as Bagyenda was only remaining with four months to retire. That didn’t go well with Mutebile who thought the IGG was interfering with his independence. President Museveni had to come in to settle the matter between the two officials who had started castigating each other in the media.

Mutebile clashes with MPs over Shs142 billion paid to Basajjabalaba

In March 2012, Museveni pleaded with Ugandan lawmakers to spare Mutebile in the Shs142 billion Hassan Basajjabalaba compensation saga. In a meeting with NRM members who sit on the Public Accounts Committee (PAC) he convened at State House Entebbe, Museveni argued then that while Mutebile erred in not consulting, he technically committed no offence, sources said.

PAC in its report on the compensation for city markets presented to Parliament then indicted Mutebile, together with former ministers Khiddu Makubuya (general duties) and Syda Bbumba (finance) for over-paying businessman Basajjabalaba over cancellation his contract to run city markets of St Balikuddembe, Nakasero, Shauriyako and Kisekka.