Norwegian, Dutch and British governments’ role in the downfall of Crane Bank

By our reporter

After the fraudulent takeover of Crane Bank in January 2017, a lot of unbelievable revelations have made their way to the public showing exactly how Dfcu Bank owners connived with the topmost bosses at Bank of Uganda to take over the once third biggest commercial bank in the country.

Apparently, Dfcu’s majority shares are owned by foreign firms and governments such as Norway, Netherlands and Britain.

The bank is partly owned by the Commonwealth Development Corporation (CDC) a British government-owned company, together with other foreign firms like Rabo Development from the Netherlands and NorFinance from Norway who are shareholders in Arise B.V together with Norfund, a Norwegian government owned Private Equity firm and FMO, the Dutch Development Bank.

Arise B.V is now the majority owner of DFCU Bank, which on 27th January last year acquired Crane Bank from Bank of Uganda where it had been under receivership.

Arise BV, which has its headquarters in the Netherlands became majority shareholder in DFCU, (owns 57.81% of shares), just three months after the latter acquired Crane Bank’s assets.

Over the past weeks, speculations have continued to become more and more apparent, that these British, Dutch and Norwegian firms played a significant role in the sale of Crane Bank.

Prior to April last year, NorFinance and Rabo Development held an equal 27.5% stake in Dfcu Limited, which wholly owns Dfcu Bank.

These shareholders did not flinch, amidst the controversy trumpeted repeatedly in the media surrounding the sale of Crane Bank.

Instead, weeks later, they were to pool resources, to form Arise BV that is now the majority owner of DFCU Bank.
It is the belief of some observers and the ill-fated former shareholders of Crane Bank, that these European firms colluded with the Central Bank and the management of DFCU bank to acquire Crane Bank under terms that have been described widely as fraudulent.

Dfcu makes abnormal profits since Crane Bank takeover;

Dfcu last year bragged in a report to its shareholders that it got the assets of Crane Bank at a giveaway price.

To prove to its shareholders that this was a fat deal, Dfcu reported after three months of taking over the assets of Crane bank that its profits had jumped from Sh31 billion to Sh150 billion.

According to the latest financial statements published in the New Vision on Thursday, Dfcu made profits worth shs127,636,000,000 in year 2017 after taxation.

The statements indicate that Dfcu made an interest in loans and advances of shs242,544,000,000 and shs119,301,000,000 from other incomes.

However, the bank’s operating expenses increased from shs1.7 billion (2016) to shs119 billion in 2017.

The increment in expenses is probably attributed to the increased number of branches and staff that were taken over from Crane Bank.

It should be noted that Crane Bank had loans and advances to the tune of shs1.1 billion, so the other loans are being carried as Non Performing Assets (NPAs) and they are being reflected as super profits on recovery and most had securities.

Below is the list of shareholders:

1 Arise BV 58.71%
2 CDC Group of the United Kingdom 9.97%
3 National Social Security Fund (Uganda) 7.69%
4 Kimberlite Frontier Africa Naster Fund 6.15%
5 Two undisclosed Institutional Investors 3.22 %
6 SSB-Conrad N. Hilton Foundation 0.98%
7 Vanderbilt University 0.87%
8 Blakeney Management 0.63%
9 Bank of Uganda Staff Retirement Benefits Scheme 0.59%
10 Retail investors 11.19%
Total 100.00%