KAMPALA — Equity Bank has indicated that the sale of Simbamanyo House was not connected to problems caused by the lockdown as proprietors had long defaulted on their loan obligations.
President Museveni on September 3, directed the Governor of the Bank of Uganda (BoU) Emmanuel Tumusiime Mutebile to investigate circumstances under which Equity Bank sold properties belonging to city businessman Peter Kamya – including Simbamanyo House and Afrique Suites.
However the bank avers the process was fair and open after the proprietors failed to service a loan even after collecting rent during lockdown.
After losing a Court Appeal that tried to reverse the sale of Simbamanyo House and Afrique Suites, businessman Peter Kamya then sought the intervention of President Museveni.
In his September 3 letter to Governor Mutebile, Mr. Museveni indicated that he had been approached by Mr. Kamya and his wife Margaret Muganwa to intervene in regard to the sale of Simbamanyo House and Afrique Suites by the bank.
‘They state that whereas Bank of Uganda directed that there should be no foreclosure of mortgaged properties by banks during the COVID-19 pandemic, Equity Bank went ahead and sold their properties at very low prices. That they had even offered to get their own buyers but all their attempts were frustrated,’ Museveni said.
But according to Equity Bank, despite a lockdown having been instituted in March 2020, the Simbamanyo proprietor was still receiving rent by June 2020 and not servicing his loan.
“He had reneged on his obligations even before lockdown,” the bank avers.
In August 2020, Equity Bank advertised that they would proceed to auction Mr. Kamya’s properties in case he didn’t service his loan, but the advert only got a response from Kamya’s lawyers Muwema & Co. Advocates suing Equity Bank Uganda, Equity Bank Kenya and Bank One, Mauritius for breach of trust, unethical and illegal conduct and predatory practices.
Mr. Kamya wanted court to declare the $10.5m loan he had acquired from Equity in 2017 illegal and wanted court to cancel the mortgages attached to the loan.
Mr. Kamya lost out after Equity successfully argued that Simbamanyo benefited and was aware of every financial transaction that was advanced to it.
Court on September 7, 2020 gave Kamya 30 days to deposit $3.1m, which was about 30 per cent of his loan obligation to stop the auction. Kamya didn’t pay the money and the properties were advertised and subsequently sold.
Kamya’s Simbamanyo House was sold to tycoon Sudhir Ruparelia’s Meera Investments at UGX 18 billion while his Afrique Suites was sold to Luwaluwa Investments.
Mr. Ruparelia has since renamed Simbamanyo House to Gender & Labour House.