Kampala, Uganda – August 4, 2025 | In a heated commercial dispute, Multiple Industries Ltd., a major manufacturer and trader of building materials in Uganda, is facing the risk of having its properties seized by Standard Chartered Bank Uganda Ltd over an outstanding loan of Shs 21.7 billion. The High Court in Kampala has intervened, issuing an interim order to prevent the bank from foreclosing on the company’s assets before the issue is fully resolved in court.

Court Ruling on Loan Dispute

Justice Simon Peter M. Kinobe ruled on Tuesday, emphasizing that allowing the bank to proceed with recovery efforts before the full trial would infringe upon the company’s right to a fair hearing. The court agreed with Multiple Industries’ argument that proceeding with the foreclosure at this stage would effectively render the case meaningless, undermining the company’s legal position.

“If execution is allowed to proceed, the substantive application will be rendered nugatory,” said Justice Kinobe. “It is important to preserve the status quo.”

Loan Background and Disputes

The dispute arises from several credit facilities extended by the bank to Multiple Industries, which includes:

• A USD 499,300 term loan (approx. Shs 1.9 billion)
• A USD 5 million import loan (approx. Shs 19 billion)
• Overdrafts totaling Shs 3.35 billion and USD 300,000 (approx. Shs 1.14 billion)

Multiple Industries claims that in February 2024, both parties entered into a consent judgment to restructure the debt. However, the company now accuses Standard Chartered of breaching the agreement by submitting inaccurate and “false and malicious” credit reports to the Credit Reference Bureau, which negatively impacted the company’s creditworthiness and hindered efforts to refinance the loan with other lenders.

Bank’s Defense

In response, Standard Chartered Bank denied the allegations, asserting that the credit reports were accurate and submitted with Multiple Industries’ consent. The bank maintained that the company had defaulted on its obligations and had repeatedly acknowledged the debt. The bank also claimed it had granted multiple extensions, with the latest deadline for securing alternative financing set for July 31, 2025.

Legal Protection for Multiple Industries

Given the risk of foreclosure and the complex nature of the dispute, the court has temporarily restrained the bank from moving forward with its recovery efforts. The court emphasized that the matter should be resolved through a full trial, which is scheduled to take place on October 13, 2025.

Broader Implications for Uganda’s Financial Sector

This case has significant implications for Uganda’s financial sector, particularly in terms of how banks manage loan restructuring and the impact of credit reporting on businesses. It also highlights the potential risks faced by companies when facing large debts and the consequences of legal disputes involving financial institutions.

Multiple Industries has been a key player in Uganda’s building materials industry since 1991, and the outcome of this case could have far-reaching consequences for similar companies in Uganda. The company’s future depends on successfully defending against the foreclosure attempt and possibly securing new financing to stabilize its operations.

As the court prepares to hear the full application in October, the business community will be closely monitoring how this case unfolds, particularly as it could set a precedent for future commercial loan disputes in Uganda.https://www.tiktok.com/@bloombergbusiness/video/7483572730344918302