By our reporter
It’s no longer a secret that Dfcu Bank took over Crane Bank for almost for free.
The Central Bank transferred the liabilities (including deposits) of Crane Bank to DFCU Bank in January, 2017.
The leaked agreement between Bank of Uganda and Dfcu indicated that the foreign owned commercial bank got Crane Bank with assets valued at Sh1.3 trillion for just shs200 billion (payment for liabilities).
The Agreement did not state the amounts of money paid by Dfcu as a net purchase price; or the payment terms for monies, or the assets (outside branches) that Dfcu was taking over.
“In real sense, no money was paid for consideration of Crane Bank,” said a lawyer, adding, “World over banks can be sold for $1 as consideration. This was a fraudulent transaction which can be successfully challenged in courts of law.”
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.