By Frank Kamuntu
City lawyers have trashed Bank of Uganda’s notice advising Uganda Registration Services Bureau (URSB) to remove the word “Bank” from the legally registered name of Crane Bank Limited, citing the Financial Institutions Act 2004.
In a notice that has been making rounds in the media, Bank Of Uganda noted that ”In line with the Supreme Court decision in which the legal status of the defunct Crane Bank Limited was pronounced, if has under Section 7(1) (a) of the Financial Institutions Act, 2004 (as amended), advised the Uganda Registration Services Bureau to strike the word “Bank” off the company name of Crane Bank Limited (the company)”.
”The purpose of this notice is to notify the public of this development and to clarify on the status of that company under the financial institutions Act 2024” the notice added.
However, Kampala legal brains have rubbished such a decision noting that BoU in the first place has not implemented the supreme Court ruling that ordered them to return all the assets of defunct Crane Bank to its shareholders and pay billions of money in costs.
” First of all, BoU was ordered to pay Crane Bank Shareholders billions of money and return all their assets which they’ve not done yet but are now diverting to small issues like interpreting whether Crane should have the word “Bank’s on it or not!, what has been in court? It was Crane Bank that BoU closed not Crane piggery Ltd, therefore, the law can not be applied retrospectively”. One Of Kampala’s top lawyers told our reporter.
”BoU must first implement Supreme Court’s ruling that ordered the handover of all the properties and assets of Crane Bank Limited than talk about Supreme Court conclusion” he added.
According to the Lawyer, BoU has no powers to de-register Crane Bank Limited but is rather looking for more trouble after loosing all the legal battles to City Tycoon Sudhir Ruparelia who is one of the biggest shareholders in the defunct Crane Bank.
Crane Bank Limited, a member of the Ruparelia Group of Companies was registered on July 23, 1990 with registration number is 80010000221522 to do banking business.
In October 2016, Crane Bank was fraudulently closed and subsequently sold to Dfcu Bank for UGX 200 billion after BoU alleged its undercapitalization in January 2017.
On July 1, 2022, the Supreme Court in a ruling, ordered the central bank to pay costs at all court levels, right from the Commercial Court, and directed that Crane Bank be reverted to its owners.
In the ruling, Supreme Court Judge Lillian Tibatemwa also contended that once a company is placed under receivership, it doesn’t lose its legal existence adding that Crane Bank was a closed financial institution on being placed under receivership, which ended on 20th January 2018.
“The end of receivership means that the Assets and Liabilities of the Crane Bank reverted to its shareholders” the ruling stated.
Now that Bank of Uganda is no longer a manager nor a receiver of Crane Bank, every sane person would wonder where BoU gets the power to direct URSB to de-register Crane Bank Limited or make any changes in the names of the company that has existed for over three decades.
