Dfcu Bank has revealed that it is well positioned to deliver on its strategic objective to transform lives and businesses in Uganda.
In a statement released on Wednesday, the bank say it is in a strong financial position with its capital ratios more than 12% which is above the regulatory minimum, placing it firmly among the top five most capitalized banks.
Dfcu Bank was among the first banks to comply with the revised Bank of Uganda minimum core requirements of UGX 120bn by 31st December 2022.
The statement came on the heels of the a ruling by a UK Court that the the Crane Bank-DFCU dispute over assets can be tried in the UK.
It had previously dismissed the Crane Bank Limited (CBL) claim on grounds that it was based on actions exercised by Bank of Uganda and therefore considered acts of the State of Uganda. The Court of Appeal has now ruled that some of the acts are commercial in nature and can be tried by a court in England.
CBL filed a claim in the English courts in December 2020 challenging the transaction in relation to the sale of some of the assets and assumption of some of the liabilities of CBL to dfcu Bank Limited (dfcu) by Bank of Uganda (not a party of the claim).
However, dfcu says, “The sale was pursuant to Bank of Uganda’s statutory powers under the Financial Institutions Act.”
dfcu filed an application challenging the jurisdiction of the English courts to hear the claim (the Jurisdiction Challenge) on grounds that the actions of Bank of Uganda (BOU) were an act of the State of Uganda exercised in pursuit of the constitutional and statutory powers of BOU, in respect of which an English court should not inquire into. The English High Court agreed, and ruled that the English courts did not have authority to hear the claim.
BELOW IS THE FULL SUMMARY OF THE CASE
Summary of the Case: Claim No. CL-2020-000859 (“UK Claim”) by CBL and Others against dfcu Bank Limited, dfcu Limited and Others
- CBL filed a claim in the English courts in December 2020 challenging the transaction in relation to the sale of some of the assets and assumption of some of the liabilities of CBL to dfcu Bank Limited (dfcu) by Bank of Uganda (not a party of the claim).
- The sale was pursuant to Bank of Uganda’s statutory powers under the Financial Institutions Act.
- dfcu filed an application challenging the jurisdiction of the English courts to hear the claim (the Jurisdiction Challenge) on grounds that the actions of Bank of Uganda (BOU) were an act of the State of Uganda exercised in pursuit of the constitutional and statutory powers of BOU, in respect of which an English court should not inquire into. The English High Court agreed, and ruled that the English courts did not have authority to hear the claim.
The Appeal:- Crane Bank Limited & Others Vs dfcu Limited & Others:- Case No. CA2022-002042 -Court of Appeal of England
- The Claimants appealed to the English Court of Appeal, which appeal was heard on 3 – 5 April 2023.
The Court of Appeal delivered judgment on 26th July 2023. The Court held that, while dfcu Bank, dfcu Limited and others who challenged jurisdiction of the UK Courts to try this matter may be right that the English Court does not have authority to consider the claim, however as some of BOU’s acts may be of a commercial nature and/or there may be public policy reasons why the English Court should decide the claim, this issue should not be decided at a preliminary stage through a jurisdiction challenge but should instead be determined through a trial.
- The Court of Appeal made no decision on the underlying facts or on the merits of the claim as these issues were not before the Court. The Appeal concerned technical legal questions raised at the preliminary stage and did not deal with the claim on its merits. The factual allegations will be for the trial judge to determine.
- Under English Law, dfcu has the right to seek permission to appeal the Court of Appeal’s decision to the Supreme Court. dfcu reserves the right to appeal to the UK Supreme Court.
- The outcome has no bearing on the Group’s day-to-day operations:
- The Group is well positioned to deliver on its strategic objective to transform lives and businesses in Uganda. dfcu Bank has a strong financial position with its capital ratios more than 12% which is above the regulatory minimum, placing it firmly among the top five most capitalized banks. Dfcu Bank was among the first banks to comply with the revised Bank of Uganda minimum core requirements of UGX 120bn by 31st December 2022.
- The Group is profitable and at its recently concluded Annual General Meeting, paid a dividend to its shareholders.
- The Group has strong shareholders, who include Arise BV, Danish Investment Fund (IFU), National Social Security Fund and Kimberlite, among others.
EUROPE-LEGAL-273679988/1 174891-0001
General – No control
- dfcu has a strong heritage in Uganda since 1964 and has been at the forefront of transforming lives and businesses in Uganda.
- The Group has a solid management team, which continues to drive the Bank’s strategic objectives to transform lives and businesses in Uganda.
- The Bank’s operations continue to function as normal. The Bank remains strong, well-capitalized and profitable, meeting all the needs of its customers and fulfilling its purpose of transforming lives and businesses in Uganda.
