KAMPALA – The Commissions, Statutory Authorities and State Enterprises (COSASE) committee has, on Thursday, November 1, grilled Bank of Uganda officials over the controversial closure of seven commercial banks who asked for more time after failing to answer some of the MPs questions.
The central bank officials led by the Governor Emmanuel Tumusiime Mutebile and his Deputy Dr. Louis Kasekende appeared before COSASE to respond to findings of the the Auditor General’s report on controversial closure of seven Banks that including Teefe Bank (1993), International Credit Bank Ltd (1998), Greenland Bank (1999), The Co-operative Bank (1999), National Bank of Commerce (2012), Global Trust Bank (2014) and the controversial sale of Crane Bank Ltd (CBL) to dfcu Bank (2017) at a paltry Shs200bn.
COSASE Chairperson Abdu Katuntu (Bugweri County) said that probe which has already attracted public attention will be handled professionally and that the committee will discuss the closure of banks in a sequence following the year of closure.
However, Rubaga North MP Moses Kasibante raised a procedural matter saying that the BoU responses to the AG report lack documentary attachments which makes it difficult to hold the officials accountable.
“Many of these people who own these banks want accountability so we need accountability. We are conscious of your (BoU) constitutional independence, but independence doesn’t mean non-accountability. We know BoU is independent but accountability is a constitutional requirement. What we are looking is accountability not criminal prosecution,” Katuntu said.
Katikamu North MP Abraham Byandala also lamented that the few documents that BoU had provided did not contain what they wanted.
In response, Mutebile told the committee that they have all the supporting documents in regards to closure of the Banks, but requested for more time to present them for scrutiny.
“It is quite impossible to reply to these demands within a day. We need a couple of days [to submit the documents]. We seek for more time so that we submit on Monday afternoon,” Mutebile said.
In his ruling, Katuntu adjourned the meeting up to Friday but allowed BoU to submit all the necessary documents by close of business on Monday November 5.
BoU officials are to be grilled by the MP’s as the inquiry focuses on the mismanagement of closed banks and dealings with external lawyers as unearthed by the Auditor General in his special audit report to Parliament, released in August.
The confidential special audit report also revealed weaknesses in the management of the Central Bank and questioned the governor and his team for the hitches in the closure of at least seven commercial banks. The board chaired by the governor will be required to respond to these queries.
New evidence has since emerged, indicating that BoU officials wrote off Crane Bank Ltd loans amounting to Shs600bn through unclear circumstances.
All the former directors of the above closed banks will also be cross-examined by the committee this week.
Pressure has further piled on BoU and dfcu Bank by 400 ex-employees of Crane Bank who have since sought audience with Speaker Rebecca Kadaga to present a petition demanding an investigation into a Purchase of Assets and Assumption of Liabilities (P&A) agreement that was signed between BoU and dfcu Bank without the knowledge of ex-Crane bank staff. The AG also queried this agreement. They are demanding Shs48b in terminal benefits.