Dfcu closes 23 Crane Bank branches

The two banks, combined, had a total of 89 branches around the country with Crane Bank having 46 branches.
However, when dfcu Bank bought some of the assets and liabilities of Crane Bank, the bank noted that only 66 branches are now open around the country.

Dfcu was confirmed by Bank of Uganda (BoU) last week to have won the competitive bidding process to acquire Crane Bank that had been under statutory management for the last three months.

“The integration entails rationalisation of the combined branch network bearing in mind that prior to the transaction there were locations where both dfcu Bank and Crane Bank had points of representation. As a result, dfcu Bank’s existing and new customers now have access to 66 branches and over 100 ATMs countrywide,” Mr Juma Kisaame, the managing director dfcu Bank, told reporters yesterday.

Some of the Crane Bank branches that were integrated into dfcu branches are Arua, Gulu, Mbale, Mukono, Mbarara and Masaka, among others. Both Crane Bank and dfcu Bank had been expanding around the country in an attempt to grow the retail segment of the market. Crane Bank was still planning further expansion by the time BoU took it over on October 20 last year. Mr Kisaame says that the closure and merging of branches was inevitable.

On the closed branches, the bank said it was still compiling the list.

“There were more branches that were with the former Crane Bank but some of them were in common locations. So what we have done is to make sure that those in common locations are merged with existing dfcu branches,” he told reporters.

Jobs still intact
The branch closures, however, did not mean people had been laid-off. For now, according to Mr Kisaame, all Crane Bank employees are dfcu Bank employees at least until the integration process is complete to determine whether there is a duplication of roles, which may require staff layoffs.

“As part of the integration, we will determine the optimum staffing levels for the combined business and we will have a way forward,” he added.

dfcu has, to-date, refused to disclose the transaction amount on the commercial transaction with Crane Bank. dfcu Bank officials bounced questions related to the transaction amount to BoU officials. The same BoU officials had referred reporters to dfcu on the transaction amount.

There has been speculation that Crane Bank did not own properties where branches were located. However, dfcu officials explained that for some branches, there was legal interest for the bank. Legal interest is something a law recognises and in the case of Crane Bank, leasehold titles for some of the properties.

“It should suffice to note that what dfcu Bank took over are the assets in the names of Crane Bank Limited. And therefore Crane Bank legal interest in some of the branches that we took over and specifically there are leasehold interests for some of the branches,” Ms Agnes Tibayeita Isharaza, the dfcu company secretary, explained.

Crane Bank was Uganda’s fourth largest bank by assets before BoU took over management because it had become significantly undercapitalised. dfcu emerged as the best bidder, beating 13 other bidders. The two banks combined now have a customer base of 950,000 accounts. Crane Bank had 500,000 bank accounts.

dfcu ownership

dfcu Bank is a wholly owned subsidiary of dfcu Limited that put up the money for the acquisition. dfcu Limited is listed on the Uganda Securities Exchange (USE).
dfcu Limited is owned by
Rabobank, Netherland. 27.54%
Norfinance, Norway. 27.54%
CDC Group, UK. 15%
NSSF, Uganda. 6.72%
Others. 23.13%