By Our Reporter
In the late 1990s and early 2000s, a number of indigenous banks sprung up in Uganda. Many however did not live to celebrate a 5th anniversary, having been declared insolvent and taken over by Bank of Uganda (BoU). Most were eventually sold to the foreign banks or liquidated primarily due to mismanagement.
The Co-operative Bank’s assets, for example, were sold to the Standard Bank and the Greenland Bank was liquidated. Others like the International Credit Bank, Teefe Bank and Gold Trust Bank were closed down. Additionally, the Uganda Commercial Bank, which at the time was the biggest local bank, was sold to the Standard Bank of South Africa. It was later rebranded into the Stanbic bank. Today, Stanbic remains Uganda’s most profitable bank.
This turmoil in the Ugandan banking sector forced government to freeze the licensing of commercial banks in 2004. In 2007, the sector was re-opened after a considerable clean-up process.
One bank however survived those troubling days in the country’s banking sector. Crane Bank opened its doors to the general public in 1995. According to BoU, Crane Bank is now Uganda’s 4th most profitable bank as of 2014 and is the 2nd most profitable indigenous bank in Uganda after Centenary bank.
The bank celebrated its 20th anniversary in April, 2015 at the Kabira Country Club in Bukoto-Kampala. The event was attended by high profile business personalities and government officials.
The Birth of Crane Bank
Behind this celebration lies an amazing story of how this bank and its owner Sudhir Ruparelia managed not only to sail through the Ugandan market but also spread to neighbouring Rwanda.
Crane Bank Boss Sudhir Ruparelia
It should be noted that the success of Mr Ruparelia’s earlier businesses led to the birth of Crane bank. In the late 1980s, “Sudhir” as he is popularly known, ventured into the Forex business. At the time, trading in Forex was largely informal, with no guidelines and regulatory framework to protect such business.
When the Forex market was formalized in 1990, Sudhir officially opened Crane Forex bureau, the first in the country. In a recent interview, Sudhir revealed how he was raking US$10,000 in daily profits on average in 1990.
And its is with this money that Sudhir started buying up chunks of undeveloped land and dilapidated residential and commercial structures in the largely undeveloped Kampala Central Business District.
By the early 1990s, his forex business had become so big, commercial banks began playing “hard ball” with Crane Forex Bureau.
Sudhir decided to venture into banking and applied for a banking license, which cost US$1M then. This is how Crane Bank opened its doors to the general public in August21, 1995.
“We established ourselves and became very prominent. Within six months, we were competing with banks in terms of foreign exchange,” Sudhir said in an interview.
He added: “Within a few years, the banks got together to start a cartel to raise charges, so we decided to go into banking business, that’s how crane bank was established.”
During the 20th anniversary celebrations, Crane Bank’s Acting Managing Director P K Gupta attributed their impressive growth to Crane Bank’s excellent customer care, good governance, loyal customers and its dedicated employees. He noted that the bank has a growing footprint of 44 branches and had won its ninth bank of the year award last year in London.
“We continue to ride on the fact that we have become a one-stop shop for all your banking needs, from doing accessing your money anywhere in the world to paying all your major utility bills” Gupta noted. The bank is now in preparations of opening its 45th branch in Gulu at Gulu University.
In 2014, the bank opened a subsidiary in Kigali, Rwanda, becoming the first local bank to extend financial services outside Uganda.
Nyambura is a senior journalist based in Kampala