Uganda 2008 NSSF Temangalo Land Saga
How old were you when you discovered that the famous 2008 NSSF Temangalo Land Saga had its roots in a bank transaction? Well…I was “three-months-ago old” when I finally connected those dots.
It all began in 1991 at a place that sounds like a chapter from a novel when a few ambitious sons of Kigezi gathered at White Rose Inn in Kabale, determined to teach their people the gospel of saving money.They formed Kigezi Commercial Bank, a noble attempt to turn “under the mattress savings” into actual banking culture.
Membership grew to over 300 proud residents.But there was a catch 22 you had to be a Kigezian to own shares.If you weren’t from Kigezi, the constitution said: “Kindly remain a customer.”
Despite cases of fraud & “creative” accounting it still survived when other banks didn’t Sembule, Teefe, Cooperative Bank…the whole squad went down. BoU, tired of playing firefighter raised the minimum paid-up capital in 1998 that sent Kigezi’s shareholders into panic mode because their capital situation was…let’s just say “lean.”
They flagged off a fundraising journey worthy of a Netflix series. With local coffers dry, the majority shareholders went fundraising abroad & landed Kenyan Asian investors willing to pump money in. Access to new cash came with a makeover: Kigezi Commercial Bank became the National Bank of Commerce (NBCU), proudly headquartered on Parliamentary Avenue in Kampala.
By 2007, NBCU was Uganda’s 22nd largest bank with $20M in assets.Not bad for a bank born in the hills of Kabale.Unfortunately the major Kenyan Asian shareholders got into an accident and was incapacitated.He asked to be bought out.
That is when the three musketeers stepped up to the occasion to save the bank by buying out the Asian’s stake rather than sale them to foreigners.These were Mbabazi Amama, Hon Ruhakana Rugunda (both ministers in the then ruling government) & Amos Nzeyi ( a business magnet)
As they thought on financial mobilisation plans one of them hatched an idea from a lightbulb moment he had :“Which institution in Uganda is always liquid, always buying land, & never shy of a multi billion shilling deal?” The handwriting was on the wall you didn’t need to be a Prophet to know that ONLY National Social Security Fund could take on that deal
And just like that,the Temangalo deal was born.The plan was as simple as pie ! Sell some of the plots in Temangalo to NSSF at UGX 24M per acre, use the proceeds to buy out the Kenyan Asian shares. Liquidity challenges closed off
Nzeyi the bona fide owner teamed up with Minister Amama Mbabazi & offered 411 acres to NSSF for UGX 11.2 billion.However unknown to them this would kick start a series of events that would get the last locally owned bank license revoked by Bank of Uganda – a story we will examine another day of several glitches.
