Bank of Uganda pays private lawyers Shs4.5 billion in five months
The deputy governor Bank of Uganda Dr Louis Kasekende before MPs on Tuesday. Photo by Alex Esagala
What you need to know:
- BoU accuses Sudhir of contributing to the collapse of Crane Bank. Sudhir, on his part, accuses BoU of breaching a Confidential Settlement and Release Agreement (CSRA)
- The committee wants the OAG to establish how much money commercial banks had at the time BoU closed them.
Kampala- Bank of Uganda (BoU) spent Shs4.5 billion in five months on lawyers representing it in its case against Crane Bank and Mr Sudhir Ruparelia.
On Tuesday BoU submitted the details in a “confidential letter” to Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) that detailed the legal fee payments.
The committee had earlier asked bank officials to tell it how much it has so far spent on legal fees.
Although the committee did not disclose the amount therein, Daily Monitor has it on good authority that Shs4.5 billion is the amount BoU has so far spent in legal fees.
Meanwhile, COSASE has asked the Office of the Auditor General (OAG) to audit the closure of several commercial banks over the years.
“We are concerned with the way the Bank of Uganda has been managing the affairs of defunct banks,” Mr Katuntu, the chairperson of COSASE, said. “We have not had proper audits of that process of defunct banks. When you say you have taken them over, you need to be transparent in the way you manage that process.”
The committee wants the OAG to establish how much money commercial banks had at the time BoU closed them.
The MPs want the OAG to establish how much money those commercial banks had lent out and how much BoU got when the collateral/security borrowers had given to the commercial banks was sold.
The OAG has three months within which to produce the report.
To beat the deadline, it will liaise with BoU, which has data about each of the commercial banks.
Over the years, BoU has closed the Cooperative Bank, Greenland Bank, Global Trust, National Bank of Commerce and Crane Bank.
However, BoU has never furnished Parliament, which has an oversight role, with a report about the closure of the commercial banks.
COSASE also wants to know how much money BoU had to part with in the course of closing the commercial banks.
Mr Katuntu said the OAG should also interest itself in what BoU’s banks supervision department was doing
“We think if it had been doing its work, these issues could have been spotted long before the commercial banks could be closed,” he said.
