Friday, July 1, 2022
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Controversial Crane Bank Sale Takes New Twist

Crane Bank

The collapse of Crane Bank and its eventual controversial sale to dfcu bank is far from over as many questions remains unanswered.

The latest is that Parliament wants the Executive to explain circumstances surrounding the capitalisation and sale of Crane Bank, owing to the fact that prior to its sale, government had injected about Shs200m to save it.

During a meeting between MPs on the Parliamentary Finance Committee and  officials from Ministry of Finance to discuss  the Ministry’s 2017/18 policy statement, the law makers  demanded to know where Minisstry of Finance got the money to try save Crane Bank yet it wasn’t budget for and they  didn’t ask for a supplementary budget.

However, David Bahati, the State Minister for Planning asked for a separate meeting to discuss the matter.

“We wanted to request you that if you allow, we can  arrange a separate special meeting to discuss issues to do with Crane  Bank together with Bank of Uganda in a comprehensive manner and also  try to address all other issues to do with the banking industry, the way we see it,” Bahati pleaded.

However, Finance Committee Chairperson, Henry Musasizi, questioned government’s intention of keeping the public in the dark in as far as Crane Bank collapse is concerned.

“Three months ago, we sent you an invitation asking  you to come to the Committee to explain circumstances surrounding the  recapitalization of Crane Bank. You responded to us, asking for more  time, which time we granted. We are surprised that up to now, you are  still asking for more time,” Musasizi candidly put it to Bahati.

Bahati noted that they don’t have any hidden agenda.

“We aren’t hiding anything because these are public issues. We aren’t asking for more time or hiding anything. What we wanted was that given the fact that we are discussing a ministerial policy, we are requesting, if you  could give us a special time, particularly to discuss issues of Crane Bank,” he said.

In the end, it was agreed that Ministry of Finance and Bank of Uganda officials appear before the Committee at the arranged meeting and discuss Crane Bank collapse and sale.

It is important to note that on October 20, 2016, the Bank of Uganda, the regulator of Uganda’s financial sector, announced that it had taken over the management of Crane Bank Ltd after the bank became “a significantly undercapitalized institution.” On February 27, 2017, BoU announced the takeover of the now defunct Crane Bank by dfcu-at an undisclosed fee.

Sources say dfcu paid about US$40m, but this hasn’t been substantiated by BoU and dfcu.

Importantly, Sudhir Ruparelia and his family owned 48.7% stake in Crane Bank. Under this shareholding structure, Sudhir Ruparelia owned 28.83% of the shares in the bank.

His wife, Jyotsna Ruparelia owned 13.8% of the shares in the bank. Sudhir’s three children; Sheena Ruparelia, Meera Ruparelia and Rajiv Ruparelia owned 1.99% shares each.

Tom Mugenga, a renowned businessman in Kisoro and Kampala, owned 0.003% shares in Crane bank. Mysterious M/s White Sapphire owned 47.33% stake in the bank.

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