DPFU creates desk to verify Greenland, Cooperative bank depositors
DFPU says that some depositors from the recently closed banks such as EFC are yet to pick up their money. Photo / File
What you need to know:
- The desk is part of a plan in which all depositors, who held Shs10m or less, in closed banks but were not paid, will be paid.
The Deposit Protection Fund of Uganda (DPFU) has said it has opened a desk in Bank of Uganda to verify all depositors in financial institutions that were closed by government.
The move is part of a plan in which all depositors, who held Shs10m or less, in such banks will be paid.
Speaking during the Makerere University Business School 28th international management conference, Mr Patrick Ezaga Onen, the DPFU director of communications, said all depositors in closed banks, who have not been paid their money, should report to Bank of Uganda with valid identification documents to be verified for onward payment.
“We have Shs58b, which is the accumulated savings from depositors in banks that were first closed: Teefe, Greenland and Cooperative Bank. Bank of Uganda is handling these cases. For the banks, which we closed this year EFC and Mercantile, we have people we are looking for to pay but they are nowhere to be seen and we have their money,” he said.
The Shs58b, Mr Ezaga said is purely savings of depositors in the banks, which were closed first.
In 1993, Bank of Uganda closed Teefe Trust Bank, accusing it of insider lending and accumulation of bad debt.
Subsequently, the Central Bank also closed Greenland Bank in 1999, before it was liquidated for violating banking regulations.
Other banks that have since been closed include Global Trust Bank, International Credit Bank (in 1998) and Cooperative Bank, which was closed in May 1999 over "inadequate capitalisation" and "insolvency to the tune of Shs4.8b.
Since their closure, government has remained tight lipped about the fate of money, which was saved by depositors at the time when the banks were closed.
Mr Ezaga said the DPFU, was created as a stop-gap measure to protect the interests of savers.
However, it was created as a standalone institution under the 2016 Financial Institutions Act to act as insurance for payment of depositors with up to Shs10m in the unlikely event that a bank closes.
