- May 27, 2021
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High Court Dismisses Tycoon Nzeyi’s NBC Bank Case Against Sudhir, Bank Of Uganda
The Businessman had jointly sued Bank of Uganda, Crane Bank ( now in liquidation) and owner Sudhir Ruparelia and Kenyan national Rasiklal Chotal Kantaria challenging the over of his NBC in 2012.
The Central Bank in 2012, announced the liquidation of NBC Bank plus its assets were later sold to Crane Bank Limited which was owned by businessman Sudhir Ruparelia.
Nzeyi dragged the Central Bank to court arguing that his bank was hurriedly and fraudulently sold without being heard, also claiming that transaction was in total breach of the Financial Act 2004.
In the suit, which he was filing for the second time, he had asked the Court to declare that BoU’s takeover of NBC and subsquent sale of its assets to Crane Bank (now also liquidated) on September 27, 2012 was illegal and in bad faith.
He also wanted the Commercial Division of the High Court to hold BoU liable for its alleged failure to supervise the banking sector.
The Court on Wednesday, dismissed the case with costs ruling that the process of winding up the bank and subsequent sale to Crane Bank Limited was done legally.
The judge said it is not enough to claim the process of liquidating and sale of National Bank of Commerce was not done legally without providing evidence to prove the same.
NBC was licenced in 2004. It was closed in 2012 for insolvency and handed to Crane Bank which was taken over by BoU on 2017.
It’s the Crane Bank takeover that lifted the lid on irregularities in BoU with several government bodies including Parliament, Commercial Court and the Auditor General’s office pointing to possible corruption ans collusion within BoU as it carried out its supervisory role over commercial banks.