Dfcu takes over Crane bank Rwanda

East African Business Week - - FRONT PAGE - BY TRIPHOMUS MUYAGU

KI­GALI, RWANDADfcu Bank is ex­pected to take over man­age­ment of Crane Bank Rwanda (CBR) fol­low­ing its highly pub­li­cized ac­qui­si­tion of Crane’s par­ent bank in Uganda, a fort­night ago. The merger os­ten­si­bly hands Dfcu Bank an un­ex­pected op­por­tu­nity to ven­ture into the Rwanda mar­ket on a sil­ver plat­ter – with­out the usual in­vestor ado. Na­tional Bank of Rwanda Gov­er­nor, Mr. John Rwan­gombwa, con­firmed last week the new in­vestor would take over CBR op­er­a­tions, con­sid­er­ing it was a full sub­sidiary Crane Bank Uganda, with 100% own­er­ship. The deal al­lowed dfcu Bank to ac­quire some of the as­sets and cherry pick some of the li­a­bil­i­ties of Crane Bank. “By ex­ten­sion, dfcu be­come own­ers of Crane Bank Rwanda. We have es­tab­lished dia­logue with dfcu, we want to see what their plans will be for Crane Bank Rwanda. Cur­rently it’s still op­er­at­ing as crane bank Rwanda,” Mr. Rwan­gombwa said in an in­ter­view with this pub­li­ca­tion. “We will dis­cuss and see if they in­tend to con­tinue with the cur­rent op­er­a­tions or if they have other plans in Rwanda,” he added. CBR was li­censed as a com­mer­cial bank in Rwanda in 2014 and be­gan op­er­a­tions with full un­re­stricted bank­ing op­er­a­tor’s li­cense. “We ex­pect that within one month we should have agreed with dfcu, on what they in­tend to do, whether it changes its name to dfcu and con­tinue op­er­at­ing or if they have other strate­gies,” Rwan­gombwa said. A source at one of the branches in Ki­gali how­ever dis­closed the new own­ers were al­ready plan­ning to re­brand the bank DFCU Bank was es­tab­lished in 1964 as the De­vel­op­ment Fi­nance Com­pany of Uganda, un­der a joint ven­ture be­tween UK’S Com­mon­wealth De­vel­op­ment Cor­po­ra­tion (CDC) and the Uganda Gov­ern­ment. Later, re­struc­tur­ing brought in DEG (of Ger­many) and In­ter­na­tional Fi­nance Cor­po­ra­tion (IFC) as equal part­ners with CDC and UDC, each hav­ing a 25% stake in the com­pany. Its ob­jec­tive was to sup­port longterm de­vel­op­ment projects whose fi­nanc­ing needs and risk did not ap­peal to the then ex­ist­ing fi­nan­cial com­mer­cial lend­ing in­sti­tu­tions. Last month, Dfcu took over the op­er­a­tions of Crane Bank Uganda, which had been un­der statu­tory man­age­ment of Uganda’s Cen­tral Bank, re­port­edly ow­ing to li­a­bil­i­ties ex­ceeded its as­sets. The ac­qui­si­tion in­cluded all cus­tomer de­posit ac­counts and loan ac­counts. At the an­nual Mon­i­tory Pol­icy and Fi­nan­cial Sta­bil­ity state­ment pre­sen­ta­tion last week, Rwan­gombwa said the bank­ing sec­tor in Rwanda holds around 66.9% of the to­tal fi­nan­cial sec­tor as­sets.

The deal al­lowed dfcu Bank to ac­quire some of the as­sets and cherry pick some of the li­a­bil­i­ties of Crane Bank.

Newspapers in English

Newspapers from Burundi

© PressReader. All rights reserved.