Cameroonian mogul Paul Fokam’s Afriland exits Uganda over lack of customers

After three years of stiff competition in Uganda’s banking and financial services industry, Afriland First Bank, a multinational financial institution led by Cameroonian banking magnate Paul Fokam, is set to exit the Ugandan market.

The move comes nearly three years after Afriland First Bank Uganda Limited, led by Fokam, was granted a commercial banking license on Sept. 12, 2019. However, due to the COVID-19 pandemic, the bank did not launch operations until Dec. 1, 2020.

As part of the move to close shop in the country, the Bank of Uganda has approved a request by Afriland First Bank Uganda Limited to apply to the high court for voluntary liquidation.

This is in line with Uganda’s regulatory requirements for a company’s shareholders to execute a self-imposed corporate wind-up and dissolution.

According to Bank of Uganda Deputy Governor Michael Atingi Ego, the decision for voluntary liquidation was the result of a strategic business review conducted by the shareholders.

He stated that because Afriland First Bank Uganda is a solvent financial institution and all depositors and other verified creditors will be paid in full.

“All depositors of Afriland First Bank Uganda Limited are encouraged to withdraw their deposits from Afriland First Bank Uganda Limited’s premises,” he said. “All other verified creditors shall be paid in full by the liquidator that has been appointed by the shareholders of Afriland First Bank Uganda Limited.”

Despite having liquid assets of UGX31.46 billion ($8.35 million) and total liabilities of UGX11.31 billion ($3 million) when it began operations in Uganda in 2020, Afriland has not issued a single loan.

Of its UGX11.31 billion ($3 million) liabilities, UGX958 million ($258,000) are deposits, while UGX8.2 billion ($2.15 million) are borrowings from shareholders and other entities.

Fokam is one of Africa’s wealthiest men, with a fortune assessed at more than $800 million in 2020, according to Forbes Afrique.

Afriland First Bank, which he founded in 1987, has grown into a leading multinational financial institution with subsidiaries in Democratic Republic of the Congo, Equatorial Guinea, Guinea, Liberia, South Sudan, Sao Tome, and Principe, Uganda, and Zambia.