COSASE Summons Mutebile over Irregular Closure of Crane Bank

The Parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) will next week start the probe into the closure of the defunct commercial banks by the Central Bank.

This was revealed by the Chairperson of the committee and Bugweri County MP, Abdul Katuntu who said that the committee is going to start its investigations next week by summoning Bank of Uganda officials together with their Board to explain the queries raised by the Auditor General.

The probe follows a letter by the committee last year requesting the Auditor General to undertake a special audit into the closure of all commercial banks by the Central Bank after the controversial closure of Crane Bank Limited.

The report from the Auditor General, John Muwanga which was made public in August queries how the Central Bank handled the closure of the seven commercial banks. The same report cites how the banking regulator spent over Shs 400 billion on the closure of Crane Bank and half of this money is yet to be recovered.

“We have set up a work plan and Wednesday next week, we shall be able to interract with the officers and Board of Bank of Uganda to explain to us the issues that have been organised by the Auditor General,” Katuntu said.

“The Governor is part of the Board and the Chairman while his deputy is still the vice chairman of the Board and we have invited them to have an interface over the issue of the defunct banks,” Katuntu added.

Katuntu also said that the committee plans to track down all the Board members of the banks that were closed by Bank of Uganda.

The special audit report carried out on these banks indicates that there were no guidelines, regulations and policies in place to guide the identification of the purchases of the defunct banks.

It highlighted that there were also no guidelines to determine the procedures to be adopted by Central Bank in the sale and transfer of assets and liabilities of the defunct banks to the identified purchaser.

In the same report, the Auditor General queried Bank of Uganda officials on the errors in the closure of Teefe Bank in 1993, International Credit Bank Ltd in 1998, Greenland Bank in 1999, The Co-operative Bank in 1999, National Bank of Commerce in 2012, Global Trust Bank in 2014 and the sale of Crane Bank Ltd to dfcu in 2016.