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‘BoU Closed Another Bank Without Inventory Report’

It has emerged that Bank of Uganda (BoU) also closed International Credit Bank (ICB) without an inventory report, the Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) has learnt.

Inventory simply means a list of goods and materials/properties that a business holds for the ultimate goal of resale or repair.

The Committee is probing BoU officials over the controversial closure of seven defunct banks. This is after the special Auditor General’s report raised anomalies in the closure of the banks in question.

In the report, Auditor General, John Muwanga expressed concerns over the failure by the Central Bank to maintain an inventory of assets and liabilities at the closure of ICB.

In his submission, Tumubweine Twinemanzi, Director Banking Supervision said told the Committee that a copy of the inventory report was submitted except it’s not call an inventory report but rather an inception report.

COSASE Chairperson, Abdu Katuntu wondered why the Central Bank didn’t follow the Financial Institutions Statute which required the Bank to make an inventory report to highlight the assets the Central Bank was taking over upon closure of the Bank.

“If you’re following the law, you should follow the law. The document he is referring to as one of the confidential report, though perusal, there is nothing confidential about this document,” Katuntu said.

He added: “He has called it an inception report and this was prepared by KPMG on the September 2001 and the bank was closed on 1999. Can you call this to be an inventory?” Katuntu asked.

Edward Katimbo Mugwanya, who worked at Bank of Uganda before, leaving 14years back told the Committee that it was the authors of the report, KPMG that had been hired that called it an inception report, and assured the Committee that the document presented answers all questions and was reconciled with report as per take over.

That is when Katuntu asked: “Does this report include list of depositors, cash balances due from other banks, cash balances due from Bank of Uganda, balances due to domestic banks, balances due to foreign banks, other assets such as securities?”

Katimbo then shifted blame to Fabian Kasi who was the staff of the Bank at the time and is then the Managing Director of  Centenary Bank and asked the Committee to be flexible, because the questions being asked pertain events that took place 25years ago.

“For purposes of record, we don’t have an inventory report,” Katuntu said.

Katimbo fired back saying, “The date at which it was prepared isn’t relevant.”

Last week, it was revealed Teffe Trust Bank was also closed without an inventory report.

COSASE is probing the controversial closure of seven banks including Teffe Bank in 1993, International Credit Bank Ltd in 1998, Greenland Bank in 1999, The Co-operative Bank in 1999, National Bank of Commerce in 2012, Global Trust Bank in 2014 and Crane Bank Ltd in 2016.

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