The Bank of Uganda (BoU), has liquidated and revoked the licence of EFC Uganda limited.
“In exercise of its powers under Sections 72 (1) and 12 (1) (d) & (g) of the Microfinance Deposit-taking Institutions (MDI) Act, 2003 as amended, Bank of Uganda (BoU) has effective today, 19th January 2024, placed EFC Uganda Limited under liquidation, revoked its licence, and ordered for the winding up of its affairs,” a statement from Bank of Uganda, signed by Michael Atingi-Ego, Deputy Governor read.
According to the Central Bank, the decision has been informed by EFC Uganda’s significant undercapitalization and poor corporate governance as detrimental to depositors’ interests.
“This action has been taken because Bank of Uganda has determined that the continuation of EFC Uganda Limited’s activities is detrimental to the interests of its depositors due to the institution’s failure to resolve its significant undercapitalization and poor corporate governance,” the statement further stated.
The central bank revealed that, together with the Deposit Protection Fund, they will inform depositors of the arrangements that will be put in place to enable them to access all of their deposits.
Furthermore, all creditors were requested to submit their claims to the Office of the Director Financial Stability, Bank of Uganda within 30 days from the date of this statement.
“All borrowers of EFC Uganda Limited must continue to service their loan obligations by making payments at Bank of Uganda offices and branches,” the central bank noted.
On property, persons possessing property of EFC Uganda Limited have been ordered to deliver it to Bank of Uganda, hand it over to the Office of the Director, Financial Stability.
In accordance with Section 69 of the Act no steps may be taken by any person to enforce any security over the property of EFC Uganda Limited (MDI) and no other proceedings or execution of legal process may be commenced or continued against the institution or its property.