EXCLUSIVE: Sudhir Speaks Out On Crane Bank Sale, Reveals Relationship With M7

EXCLUSIVE: Sudhir Speaks Out On Crane Bank Sale, Reveals Relationship With M7

By Ben Byarabaha

East Africa’s richest man Sudhir Rupareria has for the first time spoken about the impending sale of Crane Bank in which he is the founder.

In her Wednesday edition last week, The Red Pepper exclusively broke the Crane Bank sale story.  The paper reported that the bank was looking for an investor to acquire a stake in the 4th largest bank in terms of assets (Crane bank assets are valued at Shs1.79 trillion as of 2015).

Founded 21 years ago, Crane Bank is one of Uganda’s Leading Financial Institutions in terms of profitability, customer deposits and loans lent to customers.

Crane Bank has since come out to clarify on recent media reports that it has been put up for sale. In an exclusive interview with Red Pepper at his office in Kampala on Friday, Sudhir, 60, gave a hint about the transaction. He said there is nothing emotional about the deal.

“There is nothing emotional about this whole thing. Most importantly is the institution; Crane Bank, it’s not going anywhere but we are talking to strategic investors for expansion,’’ Sudhir said.

Below are the excerpts of the interview;

RP: What’s the fuss about Crane Bank sale?

Sudhir: Okay, 3-4 years ago, Crane Bank agreed to call for an Initial Public Offer-IPO (official first listing on the stock market) as an option for expansion. But this found its way into newspapers.

When the IPO issue was discussed in the newspapers, we decided to expand our network while looking for partners to further our growth.

RP:  So what’s happening now?

Sudhir: As I speak now, Crane Bank has outgrown itself hence a need for sophisticated banking management and product development system. We already have a fantastic infrastructure and with right strategic partners, we shall go to a different level. There is nothing emotional about this, most importantly is sustain the institution.

RP: Who is that strategic partner you’re looking at?

Sudhir: We are talking to a few strategic and potential partners. Hopefully soon we shall have a deal.

RP: How many partners are looking at?

Sudhir: Just one but very potential.

RP: Who is that lucky investor you’re talking to?

Sudhir: I can’t reveal details; the law doesn’t allow me because we have already signed a confidentiality clause. Any leakage, the deal may collapse, plunge or raise shares on stock markets the investor is trading on.

RP: How small or big is the transaction?

Sudhir: What I can tell is that we are discussing.  Until the deal is concluded, nothing will be revealed. Wait for the cocktail and the signing ceremony (laughs).

RP: But the investor is from South Africa!

Sudhir: I don’t know that. No disclosure!

RP: Mr. Rupareila I know that strategic investor eyeing your bank. It’s Nedbank South Africa!

Sudhir: We talked to Nedbank a few years ago but they were not serious. It’s a different animal this time.

RP: Customers are anxious. How long is the wait?

Sudhir: In a few months. You know this deal is not like selling yellow bananas. There are a lot of negotiations but hopefully by close of the year, we shall pop the champagne.

Sudhir Ruparelia and Victoria University promoter Ravij Ruparelia welcome President Museveni at the campus in Kampala
Sudhir Ruparelia and Victoria University promoter Ravij Ruparelia welcome President Museveni at the campus in Kampala at a recent function


RP: Can you calm down your customers about the acquisition?

Sudhir: Crane Bank is one of the best indigenous banks. It can’t lose that local touch. The acquisition has to be in unison with what Crane Bank stands for-same synergies.

RP:  Are you selling because the bank’s performance in the last financial year was deplorable?

Sudhir: No. The bank is highly liquidated except that we were affected by the increase in Non-Performing Assets (The bank’s Non-Performing Loans increased to Shs142.3bn in 2015, up from Shs19.36bn in 2014). This was because some of our customers failed to service their loans in time and people are not buying properties. But we have an escrow account that handles this to ensure our balance of payments is okay.

RP: Rumours indicate that Sudhir is broke. Does that explain why he is selling the bank?

Sudhir: To Sudhir, assets of the bank are just a by-the-way! Sudhir is not too much into banking. He is brutally entrenched in real estate and schools. If you look at Forbes that ranked me the richest man in East Africa, my bias is in real estate, hotels and schools.

RP: How many land titles are in your closet?

Sudhir: I don’t know… I lost count!

RP: Mr. Rupareila! Be sincere to me; people are saying you’re just a manager, business is not yours! Clear the air; how many titles? (Looks at son Rajiv and laughs)

Sudhir: That’s a hard question; okay I have more than 300 titles in my closet and still counting.  At this moment Rajiv interjects: For example, we have more than 14 buildings along Kampala Road alone.

RP: What’s the value of all those titles?

Sudhir: Around US$1bn (roughly Shs3.5trillion) excluding the bank.

Son Rajiv interjects: For example Commonwealth Resort Munyonyo is valued at US$150m (roughly Shs600bn).

RP: What’s your relationship with President Yoweri Museveni?

Sudhir: I don’t deal with politicians in my businesses. Museveni is a unique person. I have not known him to be in business except looking after his cows. All our businesses are well recorded with Uganda Registration Services Bureau.

RP: How about Jim Muhwezi. He has shares in Crane Bank!

Sudhir:  I bought him out 10 years ago when he was joining politics and at that time he was not yet a politician.

RP: How much did you pay him?

Sudhir: (Laughs)! I can’t remember!

RP: Are you happy with the trend the economy is taking?

Sudhir: It’s very sad that the economy is taking a bad trend. People concerned with the economy are not telling the truth.

RP: What’s the truth?

Sudhir: The truth is that we have been in recession since October 2013 and it will continue for the next 8 months.

The problem started in 2013 when Bank of Uganda raised CBR (Central Bank Rate) to 24% to curb inflation.  This shot interest rates to 20-30% and discouraged borrowing, thus reducing money in circulation. Many businesses also closed.

RP: What should be done to recover the economy?

Sudhir: People who implemented this interest rate thing should answer. Increasing interest rate does not help; government has to reduce interest rates, look for long term capital financing, foreign investments like I am doing, which will intern increase borrowing.

This move helped America to get out of recession in a period of less than a year. In fact the Federal Bank made twice the money it had used in the stimulus.

RP: You control at least 15% of Uganda’s economy hence a big stakeholder. How have you advised government?

Sudhir: These government officials don’t listen to anybody, it’s just bureaucracy everywhere. Government needs to create a special advisory committee on the economy to look into all these aspects, otherwise things are not good.

RP: How have you managed to pull it through?

Sudhir: I don’t have liquid but I have assets. Whatever I get from real estates, I plough it back into business. That’s why I don’t carry cash because I don’t have it. Can you imagine I just have Shs1m to spend throughout this whole weekend?

RP: You don’t have any bank loans?

Sudhir: Yes, I don’t use banks to finance my business. In fact I am using returns from my businesses, we have manages to put up 17 projects in the last three years using this formula.


Crane Bank is one of the commercial banks licensed and supervised by the Bank of Uganda. As of 31 December 2015, Crane Bank’s assets were Shs1.81 trillion, with shareholders’ equity of Shs281.43bn.  In October 2015, it had more than 750,000 customers. Crane Bank started operations on 21 August 1995.  In September 2012, Crane Bank acquired the assets and some of the liabilities of the National Bank of Commerce, formerly belonging to Amama Mbabazi after it had lost its banking license. On 30 January 2014, Crane Bank established Crane Bank Rwanda Limited, a wholly owned subsidiary, with the first branch in Rwanda opening to customers on 30 June 2014.

The bank is a member of the Ruparelia Group, which includes financial institutions, insurance companies, real estate investments, horticultural enterprises, hotels, and resorts.  As of 31 December 2014, Sudhir Ruparelia controlled the bank by controlling 48.67 % of the voting rights because of the shares held by him and his close family members. In September 2013, the media reported that the bank’s stock would be listed on the Uganda Securities Exchange in 2014.

Those plans, however, were put on hold, with the bank explaining at the end of 2014 that it was focusing on its expansion plans first.

The bank is governed by a ten-person board of directors.

Joseph Biribonwa is the chairman of the board.  Sudhir Ruparelia, the largest shareholder, serves as the vice chairman. The acting managing director is P. K. Gupta. He is assisted by three executive managers and a senior management team of 19 persons.