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Equity Bank in fight with school owners over loan gone bad
Officials of Equity Bank at the recent unveiling of the bank's new logo. File photo
KAMPALA- Equity Bank Uganda is in a fight with proprietors of two schools over an alleged syndicated illegal auction of their facility to a non-existent buyer, Mr Denis Sekabira.
The proprietors; Ronald Ndawula, Joan Nassolo, and Sarah Ndagire, have since sought the intervention of Bank of Uganda to help them regain their two schools of Everest College and Primary.
“We request that the Central Bank as the financial institutions’ regulator acts within its powers and takes relevant action against the misconduct of Equity Bank Uganda Ltd,” the three stated in their January 20 complaint to the director of commercial banking at Bank of Uganda.
It is alleged that in 2017, the proprietors of the Everest schools obtained a loan facility of about Shs600m from the bank, repayable in five years. The schools were used as collateral security.
However, along the way, the repayment process was disrupted due to several factors, including the outbreak of Covid-19 pandemic, which saw all learning institutions closed for close to a year.
This saw the school proprietors seek the restructuring of the repayment schedule though the schools were put on auction by the bank.
Prior to that, the bank through a court order, gave the school proprietors 30 days to pay at least 30 per cent of the loan balance if they were to remain with their property.
“Before the one month granted by the court to deposit 30 per cent lapsed, the bank advertised the land for sale and eventually, auctioned, sold, transferred, and mortgaged it in favour of a fictitious person without money exchanging hands, at all, between the alleged buyer and bank during the sale and the mortgage,” the compliant to BoU reads in part.
They further state that on October 30, 2020, they lodged caveats to preserve their property from illegal sale and transfer into another person’s names but the bank caused the removal of the caveats.
