The Supreme Court has ruled that Crane Bank ownership reverts to businessman Sudhir Ruparelia.
The judgment was made on Friday morning as the court dismissed an appeal filed by the Bank of Uganda/ Crane Bank (in Receivership) against Sudhir Ruparelia and his company Meera Investments Ltd.
Sudhir and his company were seeking to recover Sh 397 billion for the fraudulent takeover of the bank.
Crane Bank Limited was closed by the Bank of Uganda on October 20, 2016, after it failed to comply with a capital call on July 1, 2016.
Back then, Central Bank Governor Emmanuel Tumusiime Mutebile said that the Bank takeover was guided by the systemic nature of the under-capitalized institution to avoid financial sector instability.
In a decision read to the court by the Supreme Court Registrar Mary Babirye on behalf of five Justices of the Supreme Court; Opio Aweri, Faith Mwondha, Lillian Tibatemwa Ezekiel Muhanguzi and Percy Night Tuhaise, the Court ruled that receivership of Crane Bank Limited ended on January 20, 2018, and from that date, the management and control of Crane Bank returned to its Shareholders.
Three years ago, Parliaments’ Committee on Commissions, Statutory Authorities and State Enterprises -COSASE said, in a report, that the closure of Crane Bank by the Bank of Uganda was illegal.
The report indicated that an analysis of the Bank’s liquidity from January 1, to January 24, 2017, revealed that the financial institution had recovered from liquidity distress from mid-January 2017 to the time it was disposed on January 25, 2017.
“In fact, Bank of Uganda had stopped injecting money on January 9, 2017. Therefore the bank’s liquidity position had stabilized,” read the report which was presented before parliament by Bugweri County MP Abdu Katuntu.
The committee recommended that in the process of making a decision to liquidate a financial institution, detailed plans for the revival should be exhausted before taking the most extreme action of liquidating.
Earlier, former Crane Bank owner, Sudhir Ruparelia told COSASE that the agreement for the sale of Crane Bank to DFCU was shoddy and fraudulent.