DFCU boss, experts speak out on Crane Bank takeover



KAMPALA. The chief executive of dfcu bank, a mid-tier institution with 43 branches across the country, yesterday began the process of integrating the assets liabilities of Crane Bank Limited into its business and assured the general public of no disruption in the banking services.
Mr Juma Kisaame, the managing director of dfcu told Saturday Monitor in an interview on Friday that that they fully carried out the due diligence of Crane Bank and that they have plans in place for the benefit of the general public.
This is the second time dfcu has taken over a bank with the first one being Global Turst Bank in July 2014.
“The transaction of the Crane Bank has been done in a transparent manner and I believe there is going be stability during this time of integration,” he said.
The assets and liabilities of Uganda’s Crane Bank, which was put into receivership last year were on Friday transferred to dfcu. In October 2016, the Central Bank took over the management of Crane Bank because it lacked sufficient capital at a time when Mr Sudhir Ruparelia, the proprietor of the bank was looking for a strategic investor.
The Development Finance Company of Uganda Group commonly referred to as dfcu limited, is the holding company and it is listed on the Uganda Securities Exchange (USE), under the symbol dfcu. “In a statement issued by dfcu, yesterday the dfcu board chairman said “dfcu has began the process of integrating the assets liabilities of Crane Bank Limited into its business.”
He added: “Further supplemental actions required to give effect to this integration will continue to be implemented by both the bank and the company including additional equity injection by the company into the bank. All regulatory and cooperate approvals that may be required to complete the integration shall be sought in due course,” said the board chairman.
The chairman of Uganda Bankers Association (UBA), Mr Fabian Kasi, told Saturday Monitor that the takeover of Crane Bank by dfcu after it had been under the Central Bank management for sometimes creates confidence in Uganda’s banking industry.
“The takeover of Crane Bank by dfcu will ensure there is continuation in the banking services without any disruptions in the banking services and it will also spur stability in the financial system,” Mr Kasi said.
However, Mr Kasi asked dfcu managers to ensure that what they have takeover does not affect their operations.
The chief executive officer of African Alliance Uganda , Mr Kenneth Kitariko, said the move by the Central Bank to relieve the bank (Crane Bank) to a private operator in the local market should be able to spur confidence in the banking sector because it brings people (clients) of the former bank in the market without fear.
“Those who have been fearing that the Crane Bank would eventually be closed down should be able to begin banking because the market has been opened up,” Mr Kitariko said.
The managing director of National Social Security Fund (NSSF), Mr Richard Byarugaba, told Saturday Monitor that the takeover of Crane Bank by dfcu is good news for the market because people can transact business with the former Crane Bank now dfcu without any fear.
Explaining the challenges that come with a bank taking over another bank, Mr Byarugaba said: “There are challenges of integrating two different systems into one data, integrating of culture of people who have been working in different managements and the challenge of maintain fiscal structure of the bank that has been taken over.
“Crane Bank was operating in places where dfcu bank is also found; so the challenge is now to decide on which branch should be shut down and which one should be left is a big that has to decide on by the new manager,” Mr Byarugaba explained.
The managing director of Alpha Capital, Mr Stephen Kaboyo, told Saturday Monitor that the objective of BoU is to support financial stability because they try as much as possible to restore confidence in financial institution deemed too dangerous in order to ensure that there is stability in the financial system.
“On a positive note customers have been protected and the bank is now under new management that is regulated by the Bank of Uganda,” Mr Kaboyo said, warning that “the challenge ahead is huge”. He cited the integration of the 46 branches which dfcu has and upgrading them into their system.

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