A major London High Court trial has begun over the 2017 transfer of selected Crane Bank assets and liabilities to dfcu Bank, with former Crane Bank shareholders led by businessman Sudhir Ruparelia seeking at least £200 million in damages. The hearing is expected to run for about 16 weeks and will examine competing accounts of the bank’s takeover, valuation and transfer.

The Bank of Uganda placed Crane Bank under statutory management on 20 October 2016, citing capital and liquidity concerns. In January 2017, selected assets and liabilities were transferred to dfcu under a purchase-of-assets and assumption-of-liabilities arrangement. The legal dispute now asks whether the process was lawful and whether the transaction reflected the value of the business transferred.

Ruparelia and the other claimants allege that the bank’s operations were transferred through an unlawful process and at a substantial undervalue.

They also raise questions about discussions preceding the intervention and a disputed $27.5 million payment connected to a portfolio of Crane Bank loans. These are allegations advanced in the proceedings, not findings already made by the court.

The defendants, including dfcu and other parties named in the claim, deny wrongdoing. dfcu has maintained that the central bank’s intervention was necessary because Crane Bank was seriously undercapitalised, and says the transfer was lawful. On the disputed payment, dfcu’s position is that the money was used for a legitimate purpose connected to repayment of emergency support from the central bank.

The case also draws on earlier scrutiny of the takeover, including a 2019 parliamentary inquiry that criticised aspects of the central bank’s handling of the process. The parties differ on how the bank’s financial condition should be assessed and what the available records show about the decisions taken before and during the transfer.

The London court is expected to examine financial records, internal communications, valuations and testimony from the parties.

The claim amount is what the shareholders are seeking, not a sum awarded by the court. The outcome will depend on the evidence and the court’s assessment of the competing arguments.

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