Museveni looks for new BoU governor

In December 2007, the AG reveals, BOU signed an agreement with Nile River Acquisition Company to sell the debt portfolio of Greenland, ICB and Cooperative banks at US$25 million (approx. Shs.8.9 billion currently). The debt portfolio, however, comprised of secured, poorly secured, unsecured, and unknown loans amounting to Shs135 billion.

“I observed that there were no guidelines/regulation or policies in place to guide the identification of the purchasers of defunct banks,” the AG writes, “In the absence of guidelines of the sale of banks, there is a risk that bank assets may be sold at a loss arising from conflict of interest between BOU staff and the potential buyers.”

The AG’s wording on conflict of interest was deemed pertinent, direct, and timely as the Crane Bank saga raged.

The conflict of interest the AG is warning about has also been at the centre of the Crane Bank saga. Court last year threw out MMAKS and Bowmans, the lawyers who advised BoU over the transaction over conflict of interest.

MMAKS advised Crane Bank at the same time it advised BoU. Bowmans advised BoU and is now listed amongst DFCU lawyers according to the bank’s confidential documents The Independent has seen.

The audit firms at the centre of the deal have also been accused of conflict of interest—they audited Crane Bank when it was owned by Sudhir and severally gave it a clean bill of health.

But, by the slip of a hand, when a few months later they audited the same Crane Bank on behalf of BoU, they found problems.

One of these firms is now one of the DFCU auditors.

Bagyenda, who was at the centre of plotting and executing most of these deals is said to be perilously close to Timothy Masembe Kanyerezi of MMAKS, who at one point represented Sudhir, BoU, then DFCU.

Meanwhile the taxpayer stands to lose over Shs300 billion that BoU pumped into Crane Bank before taking it over and the subsequent court battles it is embroiled in over the same.

On the other hand, DFCU Bank, which purchased the assets and assumed the liabilities of Crane Bank, recently announced a profit growth to Shs127 billion in 2017 up from a paltry Shs23 billion in 2017. Most of this money was made off the Crane Bank deal.

If Mutebile leaves BoU before close of the year, his departure will be linked closely to his transferring of over 50 top officials of the Bank. The move in February shuffled nine executive directors who are just two tiers below the governor, 13 directors, and 24 assistant directors.