The transfer of Britain’s Commonwealth Development Corporation (CDC) Group shares it owns in DFCU Bank is becoming cumbersome after the Danish firm Investment Fund for Developing Countries (IFU) which offered to take up the said shares found the takeover of Crane Bank by DFCU wanting and irregular.
CDC Group and DFCU Bank revealed that the 9.97 percent shares are being sold to Investment Fund for Developing Countries, the Danish development finance institution in December last year. This means that IFU is scheduled to replace CDC as the second-biggest shareholder of the bank.
However, this process faces hardships originating from the manner in which DFCU purchased Crane Bank Limited in 2017 from Bank of Uganda which had been taken over the Ruparelia Group-owned commercial bank.
But now Eagle Online reports that in their attempt to do due diligence, IFU demanded that DFCU bank avails minutes regarding the purchase of Crane Bank Limited on January 25, 2017 – this neither DFCU or Bank of Uganda had.
“The demand by the Danish Company to look at the minutes, according to sources, has forced DFCU management to look at the possibility of approaching parliament and see if they can delete one of the findings of parliament’s Committee on Commissions, State Authorities and State Enterprises (COSASE) that investigated BoU over the controversial sale of seven commercial banks between 1993 and October 20, 2016.
That finding is that BoU transferred CBL assets without any minutes written, something that COSASE found unusual in the transaction of such magnitude.” Eagle Online said in the Friday news report.
During the probe of BoU, the then Executive Director of Supervision, Ms Justine Bagyenda confirmed to COSASE that the sale of CBL to Dfcu was done over the telephone and that there was no any minutes written to effect the sale. The same was confirmed by MMKAS Advocates who were the transactional advisors acting on behalf of BoU.
During COSASE probe, Dfcu officials led by chairman board of directors Jimmy Mugerwa who appeared before COSASE as witnesses in the closure and purchase of Crane Bank made a defense presentation in regards to the terms of purchase of Crane bank agreement, however, the presentation was backed by fake documents which were neither dated nor signed by the bank authority. However, this prompted MPs of the committee to kick them out and allow them to reorganize themselves.
