KAMPALA- The Orient Bank founders are back in control of the institution they founded 21 years ago.
Mr Ketan Morjaria and Mr Jay Karia have increased the stake in Orient Bank from 20 per cent to 49 per cent in the latest changes at the bank, ending a turbulent relationship with Keystone Bank.
Mr Ketan Morjaria, also vice chairperson of the bank told reporters on Wednesday that previous majority shareholders, Keystone Bank had not paid much attention to the bank.
“They (Keystone) did not aggressively focus on managing their subsidiaries, including Orient Bank. As a result, risk management measures were not adhered to leading to bad debts,” Morjaria said. In 2009, the founders sold 80 per cent to Bank PHP of Nigeria.
However in 2011, Bank PHP failed a stress test and was taken over by the state. With the 20 per cent stake they had, Mr Morjaria said they could not influence most of the key decisions especially on the direction of the bank.
The new shareholding structure also includes 8 Miles LLC, a private equity fund founded by Irish Musician and political activist, Bob Geldof. The fund takes up 42 per cent and 9 per cent minority shareholders.
“We have to stabilise the institution and improve internal controls. We want disciplined growth and very careful in managing the risks and improvement of services,” Mr Hemen Shah, Partner 8 Miles, told reporters.