BOU disclosed the financial status of global trust bank to DFCU bank with consent

By Alice Lubwama

The parliamentary committee on commissions statutory authorities and state enterprises has discovered that bank of Uganda revealed the financial status of Global trust bank with out its consent to DFCU bank before it was closed some thing centrally to the law.

Last week the committee directed the former executive director in charge of supervision Justine Bagyenda to produce all the documents concerning the sell of global trust bank after learning that the bank was sold on the same day it was closed.

The committee also discovered that bank of Uganda had in-fact closed and sold off global trust bank on the same day.

But on looking at the documents, the committee discovered that bank of Uganda entered a purchase agreement with DFCU on July 10th 2014 before Global trust bank was finally closed on 25th July 2014 which made the committee believe that they never managed the bank for a minimum of six months as required by the law.

The committee question ed Justine Bagyenda on the intention and purpose of the disclosure to which Bagyenda first said was a collective decision of the bank but the governor bank of Uganda Emmanuel Mutebile denied.

Mutebile said he was not aware of this decision to disclose the information of global trust bank to a competitor and this was confirmed by secretary board Susan Kanyemibwa.

The committee is looking at the legal closure of seven commercial banks.

Transparency international boss disappointed by conduct of BOU leaders in COSASE grill

By Deo Wasswa

Moses Waidha, the board member of transparency international Uganda says the way officials from Bank of Uganda are behaving in the COSASE committee on the closure of the commercial banks probe is enough evidence to show that they did it intentionally to defraud the tax payer’s money.

Speaking to journalists during the flagging off the anti corruption week today, Waidha noted that some of the officials being investigated are influential people in the government and they know that there are clear opportunities for them to come out of this saga.

He says the kind of impunity and level of theft being exhibited by these officials in the committee calls up the joint efforts from all private and government anti corruption agencies to help COSASE on the matter. But What’s more important is that after the investigations where will the report go”? He added.

This week Uganda will join the rest of the world to commemorate the anti corruption week 2018. The global corruption perception index 2017 ranked Uganda at the position of 152 out of 180 countries and territories.

According to Unite nations, corruption, cruelty, theft and tax evasion cost developing countries like Uganda approximately USD 1.26 trillion.

Speaking at the same press conference, John Mary Odoi noted that while much progress has needs made to date to expose corrupt acts, more needs to be done now not tomorrow.

“Despite much legal and institution framework have been put in place to combat corruption, there is still much work left to do.’’ he said. According to him, there are still weak or ineffective laws, little enforcement and limited resources to affect change and rampant abuse of power in the country which has led to slow movement in curbing corruption, with few tangible results to show for their efforts.

He has called up on Ugandans to participate in the anti corruption week activities and also to take up their role of fighting corruption since it is key in improving service delivery in the country.

Justine Bagyenda has up to Monday to show up or be arrested

By Edwin Muhumuza

Former Bank of Uganda Executive Director of Bank supervision ,Justine Bagyenda, has up to Tuesday next week at 10am to show up at parliament or face arrest. This after she snubbed the committee probing the sale of seven defunct banks by Bank of Uganda.

Being a key witness in the matter, her appearance was deemed so crucial since she was at that time in the early and mid 90’s responsible for the processes leading up to selling insolvent financial institutions.

On Thursday, while appearing before the committee on commissions ,state enterprises and agencies -COSASE, she irked the committee when she repeatedly sought to drag the governor Emmanuel Mutebile and the Board, into the controversial act at an early stage of the probe.

She was supposed to produce progressive reports detailing all activities/steps followed in the liquidation process of Greenland Bank ,which according to committee chairperson Abdu Katuntu, will guide them(legislators) on the dealings leading up to the sale of International Credit Bank(ICB) and Cooperative Bank.

However, emotions mounted when her and her successor, Twinemanzi Tumubweine traded accusations of whether she handed over all files to him amid denial ,that among the documents he was given, such reports were not included, before they were given up to today(23rd Nov) to produce them.

This morning, the committee was disappointed after she failed to attend, indicating in a letter sent to the governor, how she left the country last evening. Members sitting on the committee, accused her of contempt of parliament with some urging the chairperson to evoke powers of the committee to compel the witness to appear.

Others wondered why being cognizant of her importance ,did not notify the committee to grant her permission. In her letter, Bagyenda did not indicate what she was going to do abroad, where she was going and when she will be back.

Amidst this concern, Hon Peter Mugema Panadol,(Iganga Municipality) insisted that police should search for the documents, he said, Bagyenda could have fled with.

Hon.Francis Mwijukye (Buhweju county) sought to inform the committee that media reports had suggested that on Sunday last week, Bagyenda had been spotted at Bank of Uganda, and later seen putting documents in the back seat of her car ,a point committee chair ,Katuntu noted but cautioned the committee on entertaining hearsay.

It is thereafter members’ submissions that powers of the committee were evoked from the Constitution, Parliament power and privileges Act and Rules of Procedure to compel her to appear next week or else a warrant of arrest will automatically follow. The clerk to parliament’s office has also been requested to notify her through her known email address and telephone number. The committee has also directed Police to supply the committee with details of Bagyenda’s Travel from the immigration office.

Stop playing ‘ping-pong’ – COSASE to BOU

By Edwin Muhumuza

Former Director of Supervision for Commercial banks at Bank of Uganda, Ms Justine Bagyenda has been forced by the Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) to produce all files detailing the sale of Greenland Bank.

This after members became angry following counter-accusations amongst BOU officials particularly, Ms Bagyenda and her successor Tumubwiine Twinemanzi, on the said files.

Committee chair Hon. Abdu Katuntu had to resort to evoking the powers of the constitution and the committee to compel Ms. Bagyenda to deliver them or face arrest.

‘I need to evoke the powers of the constitution and our rules,Iam therefore directing the executive director Bank of Uganda to produce all the files that were handed over by the then director of bank supervision Ms. Justine Bagyenda to the now in charge of Bank supervision..’Katuntu directed.

Earlier Ms Bagyenda had wanted to give a chronology of events but the committee demanded for the progressive reports.

‘To my recollection, there were progressive reports , which were made to the board….Bagyenda said before she was interrupted by Hon.Katuntu.

‘No!, Ms Bagyenda, let us not play ping pong…there is an officer at the closed banks and by his terms of reference he is supposed to be making progressive reports …..the board comes at the end of the process, we want a nexus;a link between Mr, Ssekabira and the bank before you take us to the board ,so can we have those reports?’.

‘The reports were submitted by Mr. sekabira to the office of the director through the head of division, these reports would be summarized and reported to governor’s office….’Bagyenda remarked before she was again interrupted by the committee.

‘…let me tell you, I think we have a problem here, we don’t want accusations here, it will not help us go forward.

Bagyenda,finally said she does not have the reports since she is no longer in the Bank. Her successor,Mr.Tumubweine Twine, also said he did not have the reports before he went ahead to table documents that were handed to him, that were exclusive of the reports.

Ms Margaret Matovu ,former director of commercial banking department was also put on the spot over the reports.In her submission she noted that they could be at the central bank adding that she received some.

‘I said the reports might be in the bank.’ She said.

‘Might’ Where else could they be? ’the committee asked?

‘I did not have that report of handover but most of the reports were on file when I left the bank’. Matovu responded.

The meeting has been adjourned to 9 AM tomorrow.

British law demanded by buyer to sell local banks

By Edwin Muhumuza

The Committee on Statutory Authorities and State Enterprises-COSASE has faulted Bank of Uganda for having sold assets belonging to three defunct banks to a buyer(Nile River Acquisition-based in Mauritius) basing on the British Law instead of the Ugandan law.

The banks were Greenland Bank, International Credit Bank and Cooperative Bank.

Chairperson Abdu Katuntu tasked the legal counsel Margaret Kasule to explain but her response ,alluding to time constraints, did not satisfy the members.

‘Choice of the law is actually permissible but there should be a reason for it. Why did you oust our laws in a transaction of this nature’ unless there is a compelling reason from Bank of Uganda? he asked.

Members who by this time were all flooding questions to the legal counsel expressed disappointment in the institution, wondering as to why assets including secured loans, non-performing loans and poorly performing loans amounting to US $5.25million were sold to an off-shore company,yet the assets were located in Uganda.

According to Margaret Kaggwa Kasule ’’The liquidation process had taken a very long time and we had devoted a long time to the conclusion of the exit strategy almost a year to this transaction, we go ahead and get a buy who insists he needs a neutral law to apply to the transaction.’’

Margaret added that they would have abandoned the transaction after two years of planning but that act would not be prudent. She noted that the law of limitation was running against the loans.

But Katuntu wondered,”I asked you a question here yesterday, does this thing run in perpetuity and three of you people nodded in agreement.

In further interrogation Katuntu asked,”This process that identifies a buyer,was there an opportunity,can you give us evidence that actually you had looked for several buyers for this portfolio?’’

‘’That will be for the procurement department to answer’’,Kasule responded

Meantime,members cautioned Former Bank of Uganda Executive Director in charge of Bank Supervision, Justine Bagyenda to desist from using her retirement as an excuse for not contributing to the on-going probe in the controversial closure of the seven commercial banks.

This as she appeared for the very first time and was no longer an employee of the bank.

She was told to liaise with her former colleagues and bring all documentation pertaining to the sale of the banks and their assets as she held influential positions at that time.

The committee also demanded for the evidence of Mr.Bernard Ssekabira’s appointment letter, who was the then liquidator.

Democratic Party applauds the COSASE report

By Robert Segawa
Democratic Party  hails Abdul  Katuntu’s  COSASE report saying that unlike other committees, this report has pinned government officials who always solicit public resources even when they are well paid.

During a  press conference at City house party president Nobert  Mao  said that the committee’s recommendation to block president Museveni from getting a supplementary budget to refund the handshake was among the best ideas.

Mao congratulated the house over the recommendations and they agree with the findings. He therefore calls for the office of the IGG to take up the report and  implement as per law.

He adds that even power sharing in signing of Government  documents within ministries as per the report will minimize mistakes like minister Saida Bumba did when she signed on documents which she didn’t read through an act indicating that she could even have signed her resignation letter if it had been tabled before her.