The contract of the Bank of Uganda (BoU) Emmanuel Mutebile Tumusiime ends in early 2021 setting him into retirement while that of his deputy Dr Louis Kasekende ends early 2020. The latter had hopes his contract would be extended to succeed his boss in 2021, but the hopes were wiped away by the series of scandals at the central bank.
Being the deputy to Tumusiime-Mutebile, Kasekende was charged with overseeing the operations in the central bank as his boss played the role of chief executive of that institution, most times, waiting for reports from Kasekende and other senior staff.
However, it should be emphasised that the primary purpose of BoU is to foster price stability and a sound financial system. Tumusiime-Mutebile and Kasekende have been credited for upholding macroeconomic stability over the years.
That notwithstanding, the bank’s operations have caused trouble to both Tumusiime-Mutebile and Kasekende whose at the centre of the scandals, he being the overall supervisor of the officers carrying out the operations such as the supervision of banks, printing and transfer of currency notes to upcountry branches, as well as destroying of old notes.
The operations such as the closure of seven commercial banks resulted into the probe of BoU by parliament. It unearthed gaps in the way how top BoU staffs were running their duties. The probe made the public to ask how some of the officials at BoU got the jobs. Government is yet to act on the recommendations of parliament as far as the closure of banks is concerned. Major changes are expected and Kasekende’s position remains threatened.
The closure banks like Teefe Trust Bank, Greenland Bank, International Credit Bank, Cooperative Bank, National Bank of Commerce, Global Trust Bank Uganda and Crane Bank Limited (CBL) exposed Kasekende and the former executive director of bank supervision Justine Bagyenda as being unprofessional and careless as they did not follow some procedures and guidelines for the closure of banks. The banks were closed for allegedly being undercapitalized.
Further the careless closure of banks by Kasekende and other top managers at BoU has become a curse to Ugandan taxpayers as former shareholders of the banks are demanding for compensation that could hit trillions of shillings. Kasekende and his juniors did not anticipate this much as they claim they were right to close the banks.
Relatedly Ugandans are still puzzled that BoU spent Shs478 billion on CBL In Receivership yet sold its assets to Dfcu Bank at Shs200 billion, paid in installments and interest free. This calculation makes Kasekende unsuitable to replace Tumusiime-Mutebile. Worse still BoU failed to account for Shs290 billion of the money injected into CBL as liquidity support.
Further Kasekende and other would allow MMAKS Advocates to act as transaction lawyers in the sale of CBL assets, the lawyers earning billions of shillings, yet the transaction process is questionable. Kasekende and Director Legal Margaret Kasule take the biggest share of the blame here.
The two above officials would still go ahead to select MMAKS Advocates as their external counsel in the case involving Ruparelia Group well knowing they had worked for Sudhir Ruparelia and some of his companies. Court dropped the lawyers from Shs397 billion BoU/Crane Bank In Receivership case. But the taxpayer lost again in terms of legal costs.
That meant that BoU had to look for other external lawyers, further making the taxpayers incur more legal costs. Worse still court recently ruled that Crane Bank In Receivership could sue, awarding Sudhir and Meera Investments Limited costs of the suit. It is the taxpayers to pay that money.
Yet the recent alleged printing of Shs90 billion not yet recovered was also blamed on Kasekende. Also the recent scandal where officials stole old notes was blamed on Kasekende as the overseer of operations in BoU.
Kasekende therefore is not likely to succeed Tumusiime-Mutebile, more so as it emerged also that he had his own clique of officers that obeyed him and disrespected his boss Tumusiime-Mutebile.