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Equity Bank Uganda Ltd has initiated an investigation into certain staff members concerning potential fraudulent activities related to its stock loan and agent float financing, as per findings by the Monitor.
The bank’s stock finance segment encompasses lending to customers seeking to acquire stocks, ranging from consumables like soda, beer, and beauty products to commodities like cement, airtime, and fuel. Additionally, agent loan financing constitutes a specialized loan offering tailored for bank and mobile money agents.
The portion under scrutiny currently amounts to approximately Shs65 billion, representing nearly 2 percent of Equity Bank Uganda’s total assets valued at Shs1.9 trillion.
In a statement addressed to customers and shareholders, the bank expressed regret over the identified potential fraud, indicating that individuals of interest, including select staff and customers, are cooperating with law enforcement agencies in ongoing investigations.
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The institution affirmed its commitment to upholding high standards of accountability and transparency, pledging to address any responsible parties in accordance with organizational policies, procedures, ethical values, and applicable laws.
Despite the ongoing investigation, Equity Bank reassured customers of uninterrupted operations, ensuring continued access to loans through all branches and banking channels nationwide.
The Board of Directors and management reiterated their dedication to resolving the matter swiftly, emphasizing the bank’s overarching mission of empowering individuals, fostering dignity, and broadening opportunities for wealth creation.
Dr. Fred Muhumuza, a sector expert and board member of a bank, underscored that in such instances, depositors’ savings remain unaffected, with any potential losses impacting the bank’s profitability rather than customer funds. He advised against alarm, noting that the investigation is in its early stages.
Dr. Adam Mugume, Director of Research and Policy at the Bank of Uganda, stated that while they were not initially aware of the alleged fraud, the bank’s audited accounts as of December indicated overall healthiness, raising doubts about the veracity of the reports.
Equity Bank Uganda, a subsidiary of Equity Group Holdings Plc, stands as one of Uganda’s leading financial institutions with assets valued at 3.5 Trillion as of September 30, 2023. The bank boasts a network of 50 branches, over 9000 Qui Duka agents, and 58 ATMs nationwide, serving a customer base exceeding 2 million.
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