Businessman Defends Shs 427m Loan Recovery Suit Against Stanbic Bank

Kampala, Uganda | The High Court’s Commercial Division has granted city businessman Dalaus Katongole, trading as Ngoleda Stores, permission to defend a suit filed by Stanbic Bank Uganda Ltd seeking to recover Shs 427 million. Justice Patience T.E. Rubagumya ruled that Katongole had raised substantial legal and factual issues that require a full trial.

Stanbic Bank filed Civil Suit No. 430 of 2025 against Katongole, alleging he defaulted on a Shs 544,938,649 business loan disbursed in October 2022. The bank claims the loan, which was to be repaid over 48 months, has an outstanding balance of Shs 427,593,725 and moved to foreclose on the mortgaged property in Kikusa-Mawanyi, Wakiso District.

Katongole, in his defence, argued that the bank’s loan calculations were irregular and inflated. He submitted an investigative audit from Gingo Roland & Partners, which allegedly revealed unlawful deductions, unexplained transactions, and interest overcharges amounting to Shs 2.15 billion. He claims to be entitled to a refund and a setoff.

He further challenged the validity of the mortgage, saying the certificate of title for the mortgaged land had been cancelled in an earlier High Court case. His wife also swore an affidavit denying having consented to the most recent mortgage, and accused the bank of forging her spousal consent signature.

Stanbic Bank denied the allegations and argued that Katongole’s audit report was biased and lacked professional integrity. The bank stated it had extended 52 loan facilities to him since 2012, and that the current facility was simply a restructuring of earlier credit. The bank insisted that the property in question is still registered in Katongole’s name and that his liability remains intact.

Justice Rubagumya, however, found that the defence raised serious questions about the loan’s legitimacy and the mortgage’s validity, which could not be resolved through summary judgment. She noted that disputes over possible fraud, illegal deductions, and forgery of consent documents constituted triable issues.

She ruled that the matter must proceed to full trial, stating: “The facts and evidence adduced by both parties disclose triable issues of law and fact that ought to be determined by the Court.”

Katongole has been granted unconditional leave to defend the main suit and must file a written statement of defence within 15 days. The court ordered that costs of the application will be determined at the conclusion of the main suit