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Owners Of Defunct Global Trust Bank Demand Shs316bn From BoU Over Illegal Closure

Bank of Uganda (BoU) woes continues to deepen. The latest is that owners of Global Trust Bank (GTB) are demanding for over Shs316.5bn the Central Bank over what they call malicious and illegal closure of their bank.

The plea was made by the five member team of former owners of Global Trust Bank on Thursday, who had appeared before the Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) that is investigating the procedure used by Bank of Uganda to close the seven defunct banks.

Bayo Folayan, a former manager at GTB rubbished Bank of Uganda’s argument that their bank was significantly undercapitalized, stating that Global Trust Bank was highly liquid at the time of closure.

Folayan blamed Bank of Uganda for shutting out the shareholders of Global Trust Bank arguing that Uganda’s tax payers need to compensate shareholders for wrongful act perpetrated by one of its government agents-BoU.

“From the above, it is obvious that great damage has been done to our business and we are demanding for USD35.5M approximately Shs131.4bn with interest of 10% from the date of closure. We request Bank of Uganda to release four land titles and we are also asking for payment of USD50M equivalent to Shs185.12bn,” Bayo said.

Global Trust Bank was closed on 25th July 2014 due to undercapitalization and corporate governance weaknesses.

During the probe, the Committee discovered that before Bank of Uganda took over the Nigerian based Bank, former Executive Director Supervision, Justine Bagyenda made a phone call to Dfcu Managing Director, Juma Kisaame to start negotiations into the Bank’s sale on 10th July 2014.

Bagyenda’s actions were in total contravention of Bank of Uganda Act that bars the central Bank from sharing confidential information of commercial banks with its competitor.

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