Home / Business / Bank of Uganda runs out of Cash, beg parliament for help

Bank of Uganda runs out of Cash, beg parliament for help

Government of Uganda is seeking for at least Shs620.7 billion to save the under capitalised Bank of Uganda and five other commercial banks.

The revelation was made on Wednesday by Lawrence Ssemakula, the Accountant General in the Ministry of Finance while interfacing with the Parliament Committee on Finance to present a ministerial policy statement on Treasury operations.

“They [BoU] have indicated that they have been impaired from June 2013. So as per the BoU Act, we have no option but to allocate the money in our budget since their operations are in deficits,” Ssemakula said.

When pressed on the real problem at Bank of Uganda, official revealed that the deficits are captured in the Auditor General’s reports.

Keith Muhakanizi, the Finance Ministry Permanent Secretary, had previously written to the Clerk of Parliament, stating that BoU had registered a deficit of Shs17b and talked of operating losses of Shs457b on account of “monetary policy” and “currency costs”.

The MPs last year accused the Finance ministry of “stampeding Parliament” and insisted that the losses at BoU were not fully explained, and that the request recapitalisation came at the end of the budgeting process.

This made some MPs to ask for detailed investigation into the cause of losses and deficits at BoU before injecting the taxpayers money in the bank.

The State Minister for Microfinance, Mr Haruna Kasolo, revealed that government plans to spend Shs141.2b on five other banks.

The Director Budget, Kenneth Mugambe, told the MPs that the banks to be capitalised included Uganda Development Bank, Post Bank, Housing Finance, Trade and Development Bank, and African Development Bank.

Facebook Commenting
InfoUganda App on Google play store

About James Ateenyi

Check Also

Must read: Find out which prominent bank is about to collapse

This is how banks posted in 2018… The country has 5 loss making banks including …

Tell us about your opinion on this article

error: Content is protected !!