ANALYSIS: Sudhir, BoU fallout

While at the meeting, he told the officials what the owner of the bank had told him. Mutebile tried to explain but the president was so angry, he couldn’t let him explain. Mutebile kept quiet. When Bagyenda also tried to explain, Museveni cut her off and called her the enemy of development. He said he was going to fire them for what they had done.

Mutebile and Bagyenda, knowing they were being treated unfairly, decided to resign before the president could fire them. Given Mutebile’s international credentials, the president’s handlers feared that this would be an international scandal and would have far-reaching implications on the central bank.

In fact, insiders say that Bagyenda had already typed out and signed her resignation letter. However, before she could resign, the president was presented with new evidence from among others a Ugandan investor who was working closely with the GTB owner.

The Nigerian co-owned NiC, GTB and an insurance company in Rwanda. It turned out that he was in the habit of moving money around the three companies whenever the regulators of these sectors raised concerns.

Officials at the Central Bank were armed with data showing that he had only been compliant six times out of eighteen. When this data was presented to the president, he was convinced. The meeting took place at the State Lodge in Fort Portal. For a number of times, Bagyenda would go to the president’s seat, kneel and the president would say; “now you are my friend”.

In the case of Sudhir, however, insiders felt that the president did not go to such lengths.

Yet, by any standards, Crane Bank was more significant in Uganda’s banking sector than GTB. Crane Bank was the fourth largest bank by assets. The bank was also the biggest bank owned by a local—Sudhir is a Ugandan national of Indian origin. Sudhir was the biggest lender of Uganda’s local businessmen—from Kikuubo traders, manufacturers, real estate dealers and traders dealing with South Sudan, which had become Uganda’s biggest market.

There was even evidence that some of Sudhir’s problems were as a result of problems afflicting the general economy. Some of his debtors like businessman Patrick Bitature had been unable to meet their loan obligations because government hadn’t paid them. Other debtors like Spencon and Amina Moghe were also part of the problem. Government recently bailed out Moghe with over Shs.60 billion, which she used to service her loan now being handled by DFCU following its acquisition of some of Crane Bank assets. But even before this, President Museveni had directed officials to look into proposals on how to bail out these businesses.

But none of all this seemed to matter at this point. Some say part of the reason the president was not too keen to intervene on behalf of Sudhir is that the central bank had presented to him overwhelming evidence that Sudhir was involved in fraud that put depositors’ cash at risk. This is especially because BoU , armed with findings of a forensic audit by PWC, commissioned by the Central Bank, had found that Sudhir concealed the true extent of his shareholding in the Bank, and conspired with other Crane Bank officers to effect the irregular transfer of the Crane Bank’s branch ownership to Meera Investments Limited, a company fully owned by the Ruparelia family and that he had fraudulently extracted some $ 80 million from the bank.

But others say that Sudhir lacked political leverage. It appears, the tycoon had overtime alienated himself from most of the top decision makers who were now at the centre of these negotiations and others who could have used their political clout to intervene on his behalf.

Others say, there was a sense that Sudhir had somewhat grown into a political threat.

For instance, the President’s brother, Caleb Akandwanaho, aka, Salim Saleh, who is seen as the defacto number two in the power hierarchy, had asked to borrow money from Sudhir. The tycoon declined to lend Saleh money because he didn’t have enough collateral.

“I asked Sudhir to lend me money and he refused,” Saleh would later tell those close to him, “he missed an opportunity to control me the same way he controls politicians in this town. He also missed the opportunity to cultivate an important relationship.”

It wasn’t just Saleh who harbored such feelings about Sudhir.

The President’s son-in-law, Odrek Rwabwogo had borrowed money from Sudhir and got problems paying back. When Sudhir got so hard on him, he sought the intervention of the mother-in-law. Sources say Janet Museveni called Sudhir requesting that the tycoon exercises some patience with Rwabwogo. Those close to Janet say she felt that Sudhir declined. Sudhir says he didn’t.

But the First Lady never forgot and when some people approached her at the height of Sudhir’s troubles she also stayed away. “He is not a very good man,” one source quoted her as having said, “I can’t get anywhere close to his issues.”

Janet didn’t say it was because of her personal experience with Sudhir. Although Crane Bank officials claim that the bank had not sold a single client’s property between 2003 and 2015, the perception that Sudhir was in the habit of grabbing the bank borrowers’ properties had spread so wide that the first family thought it was still happening. And this still coloured how they viewed him.

Apart from Janet, even President Museveni appeared wary of Sudhir’s ways. One day while at his farm in Kisozi, one of his contacts asked him why he was selling a herd of 600 cows. Museveni said that he had tried to borrow money from Stanbic and failed and had borrowed from Crane Bank.

“I am going to pay Sudhir,” he said explaining why he was selling the cows, “I don’t want him to auction my ranch.”