• Latest
  • Trending
The Curious Case Of Simbamanyo

The Curious Case Of Simbamanyo

October 8, 2020
Kabaka Has Not Been Poisoned -Katikiro Mayiga

Kabaka Has Not Been Poisoned -Katikiro Mayiga

April 16, 2021
Kampala Lord Mayor Erias Lukwago In A Stable Condition

Kampala Lord Mayor Erias Lukwago In A Stable Condition

April 16, 2021
Katosi Water Treatment Plant Nearing Completion

Katosi Water Treatment Plant Nearing Completion

April 16, 2021
Captain Dennis Onyango Hangs Cranes Gloves

Captain Dennis Onyango Hangs Cranes Gloves

April 12, 2021
Hippos, Heathens and Kobs Cruise to Comfortable Wins As Impis Fall At Kings Park

Warriors Fail The ARROGANCE Test

April 12, 2021
Cranes Captain Fires Back At Magogo Over “Shitty” Football Remarks, Threatens To Quit National Team

Cranes Captain Fires Back At Magogo Over “Shitty” Football Remarks, Threatens To Quit National Team

April 12, 2021
JUST IN: Thugs Impersonating NWSC Arrested

JUST IN: Thugs Impersonating NWSC Arrested

April 12, 2021
AKA’s fiance Nellie Tembe dies in Cape Town Hotel Tragedy.

AKA’s fiance Nellie Tembe dies in Cape Town Hotel Tragedy.

April 11, 2021
The Quest for the Pearl Of Africa’s next top artist launched.

The Quest for the Pearl Of Africa’s next top artist launched.

April 10, 2021
Rap Icon DMX Bows Out

Rap Icon DMX Bows Out

April 10, 2021
Bishop Semogerere To Oversee Kampala Archdiocese

Bishop Semogerere To Oversee Kampala Archdiocese

April 8, 2021
Devise Concrete Solutions On  Violations Against Migrant Workers- Minister Frank Tumwebaze

Devise Concrete Solutions On Violations Against Migrant Workers- Minister Frank Tumwebaze

April 7, 2021
Mambo News
Monday, April 19, 2021
  • Home
  • News
  • Business
  • Tech
  • Health
  • Lifestyle
  • Entertainment
  • Sports
  • Opinion
  • Jobs
No Result
View All Result
Mambo News
No Result
View All Result

The Curious Case Of Simbamanyo

by admin
October 8, 2020
in Current Affairs
0

The banking system in Uganda has recently come under so much scrutiny in how they “fraudulently” handle the loans. 

Renowned architect and businessman Peter Kamya, proprietor of the Simbamanyo, is in a court battle with Equity Bank Uganda and Equity Bank Kenya, with the former, through his lawyers Muwema & Co. Advocates, suing the banks for breach of trust, unethical and illegal conduct as well as predatory practices.

YOU MAY ALSO LIKE

Kabaka Has Not Been Poisoned -Katikiro Mayiga

Kampala Lord Mayor Erias Lukwago In A Stable Condition

This comes at a time when businessman Ham Kiggundu is in a legal battle with Diamond Trust Bank around the same issues – foreign banks transacting unlawfully in Uganda. 

Peter Kamya contends that what he is going through with the Equity banks, and Ham Kiggundu with DTB, is a small part of a huge problem and it has to stop. 

Background.

In August 2012, Equity Bank Uganda and Equity Bank Kenya granted Kamya a USD 6 million loan to finance the construction of a hotel in Luzira as well as take over Kamya’s prior loan from Shelter Afrique.

Equity Bank Kenya was the lender that advanced USD 2.5 million while the rest, USD 3.5 million, came from Equity Bank Uganda. 

Loan payment problems arose and said in court that the bank was fabricating charges, which subsequently increased the amount he was supposed to be paying back. Owing to these issues, Kamya said that Equity Bank advised him to sell the land he owned in Munyonyo to raise money that would significantly help his loan clearance. 

The bank went on to broker a deal with Eritrean investors, the Bahamas group, to buy the land for Shs 5.5 billion, who was requested to a make 40% deposit, an agreement Kamya says he never saw. 

The Bahamas group would later put a caveat on his land and please to have it lifted fell on deaf ears. This was the start of the court battle. 

He sued Equity bank for the unlawful debiting of the loan account, whose debt stood at $7.1m, saying there were fabricated charges leading to the arrival of that amount.

The high court would later grant Simbamanyo an injunction, restraining Equity bank from selling the securities, on condition that Simbamanyo deposits 30 percent of the debt. This ruling was contested by Simbamanyo’s lawyers who said the plaintiff’s constitutional presumption of innocence was being eroded.

In efforts to have the matter settled out of court, the two Equity Banks brokered a deal with Bank One in Mauritius to lend USD 10 Million to the plaintiff to offset the old loan. 

Payments:

  • Equity Bank Uganda and Equity Bank Kenya received USD 10 million and paid themselves USD 8.1 million claiming it was the total amount due. 
  • An additional USD 1.32 million was taken by the banks as the brokerage fees.
  • Simbamanyo was required to pay USD 200,000 in loan processing fees, and USD 398,000 in interest. 

The businessman argues that he was bullied by the two Equity Banks into accepting the terms of the Bank One loan. 

“Equity Bank Uganda, in concert with Equity Bank Kenya, and Bank One stood in a stronger financial position as the lender and they intimidated, dominated, took advantage of and exploited the weaker position of the plaintiff as a borrower by making it enter into the illegal and predatory loan agreements largely meant to benefit the lenders and their brokers to the detriment of the plaintiff. The above statement clearly indicates that the loan outstanding to the 1st and 2nd defendants was only $ 7.1m and not $ 8.1m as claimed. Therefore, the defendants overpaid themselves by $910,476.”

Peter Kamya says that the Uganda bankers association shields their member banks and foreign counterparts into bullying clients.

“The banks have often used their very powerful lobby the Uganda Bankers Association (UBA) to literally bully the government, the regulator and borrowers on how to run the financial service sector to their advantage,” says Simbamanyo. 

Equity Bank had moved to advertise the sale of Kamya’s properties as Simbamanyo house and Afrique Suite in Luzira, an act that Kamya termed as extremely frivolous and outrightly disrespecting the court process. 

He is at the risk of losing the said Simbamanyo building on Lumumba Avenue, on which sits the Ministry of Gender, Labour and Social Development, and three plots of land housing Afrique Suite Hotel at Mutungo in Luzira.

Simbamanyo, through his lawyers, say they petitioned to halt the sale because they already had a case in court challenging the legality of the outstanding loan.

Commercial Court Querries Legality of Ham-DTB Deal And UBA Reacts To The Ruling

As Kamya battles Equity Bank in court, the commercial court, on 30th September, ruled that DTB’s auction can only happen after the legality of the transaction between Diamond Trust Bank-Kenya (DTB-K) and Kiggundu has been settled.

Kamya could not hide his delight when the commercial court stayed the audit process of the parties’ transactions saying that banks are bullies and make many unlawful transactions with the guise of saving the financial sector.

“Banks are bullies, and they use the powerful Bankers Association body to do it. As a result, the number of borrowers they have literary sent to an early grave is un-imaginable. The number of businesses they have driven into the ground in their sole pursuit of profit no matter what is alarming and has caused untold misery and suffering to the populace,” said Peter Kamya. 

“One wonders therefore why they are crying foul to the extent that the financial sector is going to collapse. They go further to claim that their capital will be badly eroded a situation that could in extreme result in the collapse of the financial services sector leading to the loss of many jobs.”

On 8th October, the Uganda Bankers Association, an umbrella organization that brings together 35 financial institutions in Uganda, and of which DTB is a member, released a statement saying that the ruling is going to put at risk over USD 1.53 billion (UGX 5.7 trillion) in the syndicated portfolio, exclusive of the lending to the Government Of Uganda. 

The statement goes on to proclaim that Justice Adonyo’s ruling has sent shockwaves through UBA’s international partners and this will affect Uganda as an investment destination. 

UBA goes further to call on the central bank, Uganda’s executive arm through the Ministry of Finance, Planning, and Economic Planning and Attorney general to pronounce themselves on this matter so as to cement the country’s position, with respect to investment credibility. 

Kamya says that the involvement of foreign banks is not only illegal but also alarmist. He says that banks claim that the financial sector and that statement is meant to the law in their favor. 

“This kind of alarmist narrative smacks of the arrogance of the highest degree.

As if to suggest that the banks should be allowed to operate outside the law because if they don’t the financial services sector will collapse. How about the borrowers’ businesses if not the actual borrowers themselves, they have sent to their graves?  Selling off their securities for a song?” Kamya asks. 

“This is a narrative many foreign investors use to try and escape the law and must not be allowed to obtain. We need foreign investors, YES but they must respect our laws. These foreign banks must in no uncertain terms be held to account by the law. And that nobody, absolutely nobody is above the law. The law is the law! And this is what Justice Henry Peter Adonyo has just done. Bravo Justice Adonyo.”

October is set to be a momentous month as the courts of law rule in both cases. Legal analysts say that should the court deem these banks transacting illegally, the cases could as well be dismissed and the banks would have no locus to demand any money back. 

Tags: Equity Bank KenyaEquity Bank UgandaHam KiggunduPeter KamyaSimbamanyo House
ShareTweetPin

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Search

No Result
View All Result

Recent News

Kabaka Has Not Been Poisoned -Katikiro Mayiga

Kabaka Has Not Been Poisoned -Katikiro Mayiga

April 16, 2021
Kampala Lord Mayor Erias Lukwago In A Stable Condition

Kampala Lord Mayor Erias Lukwago In A Stable Condition

April 16, 2021
Katosi Water Treatment Plant Nearing Completion

Katosi Water Treatment Plant Nearing Completion

April 16, 2021

About Us

Picture this; The taste of fresh ground coffee in the morning, a plate of scrambled eggs with bacon on the side and a glass of juice and fruit to top it all off… The perfect balance to start your day.

Content is second only to breathing at Mambo news, and we package it balanced as a diet.

Recent News

  • Kabaka Has Not Been Poisoned -Katikiro Mayiga
  • Kampala Lord Mayor Erias Lukwago In A Stable Condition
  • Katosi Water Treatment Plant Nearing Completion
  • Home
  • News
  • Business
  • Tech
  • Health
  • Lifestyle
  • Entertainment
  • Sports
  • Opinion
  • Jobs

© 2020 Mambo News Designed By Solution To Computer Problems

No Result
View All Result
  • Home
  • News
  • Business
  • Tech
  • Health
  • Lifestyle
  • Entertainment
  • Sports
  • Opinion
  • Jobs

© 2020 Mambo News Designed By Solution To Computer Problems