Crane’s impairment charges almost quadrupled to 50.4 billion Ugandan shillings
The central bank says the collapse of Crane Bank Ltd., which is said to have been “significantly undercapitalized” after making a loss of 12.5 billion Ugandan shillings last year caused by the economic slowdown and low commodity prices has no effect on Uganda’s economy.
In a statement from the Director Communications, Ms Christine Alupo, she dispels any rumors or claims regarding instability in the financial sector, urging the public to continue going about their banking business “without panic”.
“Following Bank of Uganda’s takeover of management and control of Crane Bank Ltd on October 20, 2016, there have been false and malicious rumours circulating on social media platforms regarding the state of the financial sector as a whole. The Bank of Uganda hereby dispels all those rumours and reaffirms that the financial sector as a whole is stable, sound and resilient,” the statement reads in part.
“The public is hereby advised to continue conducting their banking business without panic. Should anyone have any inquiries on Crane Bank Ltd, in particular, and the health of the financial sector in general, please contact the Director Communications,” the statement adds.
At Crane “operations will continue normally,” the regulator said, adding that it will continue to protect the interests of depositors to maintain the stability of the financial sector.
Crane Bank, which has almost 500,000 accounts and 46 branches in Uganda and others in Rwanda , made a loss of 12.5 billion Ugandan shillings last year as impairment charges almost quadrupled to 50.4 billion Ugandan shillings and operating expenses rose 43 percent to 103.7 billion Ugandan shillings.
Bank of Uganda is following regulators in Nigeria, Zambia, Kenya and Mozambique that have stepped in to prop up failing lenders and remove management as the slump in sub-Saharan Africa deepens, exacerbated by low oil and metals prices and a slowdown in China, one of the continent’s biggest trading partners.
