TOP
Tuesday,December 01,2020 02:12 AM

Judge warns BOU over Commerce bank

By Vision Reporter

Added 2nd May 2012 03:14 PM

KANYEIHAMBA claims the bank's name was changed from Kigezi Bank of Commerce without his authorisation and that of 320 other shareholders

KANYEIHAMBA claims the bank's name was changed from Kigezi Bank of Commerce without his authorisation and that of 320 other shareholders

By Andante Okanya
 
JUSTICE Geoffrey Kirwabwire of the Commercial Court in Kampala has warned Bank of Uganda(BOU) over its non- committal attitude in furnishing the court with information regarding the contentious operations of the National Bank of Commerce(NBC).
 
On Monday, the judge was irked when senior BOU officials who had earlier been summoned to appear in court, were absent.The judge later requested a lawyer Peter Musoke to dash to BOU.The lawyer later returned with BOU Commercial Director Benedict Sekabira.
 
The officers had earlier been asked by Justice Geoffrey Kiryabwire of the Commercial Court to volunteer information on the bank's management.The judge  had  emphasised that the officials had to physically appear in court and not write.
 
"We don’t want to do BOU’s job! For us we are courts of law. If you don’t do your work, we shall do it for you.The order was for them to appear in person and not to just write to court,” the Judge said.
 
Grilled by the judge on whether he was aware of the facts of the case, Sekabira stated that  he was inadequately prepared to proceed. Accordingly, the judge adjourned to May 23.
 
The case arose in July 2010, when retired Supreme Court judge, George Kanyeihamba, together with 320  other  shareholders petitioned court over the legality of the NBC,claiming that it was wrongfully reconstituted.
 
Kanyeihamba claims the bank's name was changed from Kigezi Bank of Commerce without his authorisation and that of 320 other shareholders. The aggrieved accuse Prime Minister Amama Mbabazi, ICT minister Ruhakana Rugunda, and businessman Amos Nzeyi, of being behind the illegality.
 
The bank was jointly founded in 1991 by the accused together with Kanyeihamba and Amos Bakaine, to provide banking services and soft loans to people in Kigezi.
 
The retired judge also wants court to task the central bank to explain how the alleged illegality was carried out without adhering to procedure.
 
According to NBC's share partition, Rugunda, Mbabazi and Nzeyi are the majority shareholders, with 86% shares. Kanyeihamba and the 320 other shareholders who include former finance minister Ezra Suruma, and former Health Minister Jim Muhwezi(Rujumbura  County MP), own the remaining 14% of the shares.
 
The aggrieved further allege that the trio changed shares and share structures of NBC and re-constituted the share structure, saying it was unlawful. The retired judge also wants court to task the registrar of companies to explain how the purported illegality was carried out without adhering to procedure.
 
The trio is also accused of breaching procedure and disrespecting the minority shareholders, when they changed the bank's name without convening to get their consent.
 
In October 2009, the Abu Dhabi Group representative and current chairman of the bank announced they had injected $10m (about sh20b) to capitalise the bank.

Judge warns BOU over Commerce bank

Related articles

More From The Author

More From The Author