UGANDA: Uganda takes control of Tropical
By The Islamic Globe published 1 year ago
Original Article Source: Zawya
Filed Under: News Articles
Uganda's Central Bank has taken control of Libyan-owned Tropical African bank to protect it from the UN sanctions being imposed on the assets of the North African country, according the CBU's governor, Emmanuel Tumusiime Mutebile.
Tropical is in the vanguard of Islamic banking in Uganda, ready to become the first institution to offer Islamic financial products once the country's parliament ratifies legislation that would regulate Islamic banking in the East African nation.
The take-over follows UN imposed travel bans and asset freezes on Libyan president Muammar Qadhafi and his family members. Various countries have extended these sanctions to assets owned by the government of Libya and prior to CBU's move, Tropical Africa was jointly owned by the Libyan and Ugandan governments, with 99.7% owned by state bank, the Libyan Foreign Bank and 0.3% owned by the Republic of Uganda. As Kampala announced a freeze on Libyan-owned assets in Uganda, worth some $375m, control of Tropical African was ceded to the government.
The CBU sacked the board and the manager appointed by Libyan Arab Foreign Bank in order to ensure the lender was "fully independent of the Libyan government," Mutebile said in a statement. He continued, explaining these measures were taken to ensure that Tropical Bank could continue to operate normally as a commercial bank in Uganda: "Tropical Bank is in a sound financial condition and will continue with its normal business operations," he said.
Since assuming control, the new management of Tropical African issued a statement through the website of the CBU assuring financial institutions and the general public that the situation in Libya would not in any way affect the financial sector in Uganda or the retail operations of Tropical African Bank, as the institution was now fully incorporated in Uganda and controlled by the Ugandan government.
Uganda's foreign minister, Okello Oryem said that Tropical Bank's operations in Uganda would not to be frozen except for cross-border transactions with Libya in line with the other Ugandan banks' prohibition of business with Libyan government entities and private Libyan companies.