Bankers’ reluctance angers government
May 11, 2004
THE Government is concerned over commercial banks’ reluctance to lend concessionary donor loans, a situation which has left huge sums of money meant for concession credit lying with the Bank of Uganda, state minister for energy has said.
By Abubaker Mukose
THE Government is concerned over commercial banks’ reluctance to lend concessionary donor loans, a situation which has left huge sums of money meant for concession credit lying with the Bank of Uganda, state minister for energy has said.
Daudi Migereko said the Government had secured the money to be lent out to firms and individuals in the energy sector on concessionary terms but commercial banks had refused to access it hence defeating efforts to speed up rural electrification.
“Commercial banks are not accessing this money giving reasons that they have enough, yet they are not lending. This is a disservice to those who earn a living through business,†the minister said.
Migereko was speaking at the launch of an over-draft bridging facility by Allied Bank International at Crested Crane Hotel in Jinja recently.
He said much as profit portfolios for commercial banks were doing well, they were mainly dependent on Treasury bills and not lending.
Migereko said commercial banks had shown strong growth in their earnings boosted by interest from Government securities, Treasury bills and bonds, as shown by their published financial statements last month.
He said the energy sector planned to cover 10% of rural electrification by 2012, but this was being frustrated by lack of financial inter-mediation by commercial banks.
Allied Bank’s director Ahadzi Kwame said they were eyeing the loans and would soon avail them to the business people after fullfilling Bank of Uganda’s conditions.
Ends
THE Government is concerned over commercial banks’ reluctance to lend concessionary donor loans, a situation which has left huge sums of money meant for concession credit lying with the Bank of Uganda, state minister for energy has said.
Daudi Migereko said the Government had secured the money to be lent out to firms and individuals in the energy sector on concessionary terms but commercial banks had refused to access it hence defeating efforts to speed up rural electrification.
“Commercial banks are not accessing this money giving reasons that they have enough, yet they are not lending. This is a disservice to those who earn a living through business,†the minister said.
Migereko was speaking at the launch of an over-draft bridging facility by Allied Bank International at Crested Crane Hotel in Jinja recently.
He said much as profit portfolios for commercial banks were doing well, they were mainly dependent on Treasury bills and not lending.
Migereko said commercial banks had shown strong growth in their earnings boosted by interest from Government securities, Treasury bills and bonds, as shown by their published financial statements last month.
He said the energy sector planned to cover 10% of rural electrification by 2012, but this was being frustrated by lack of financial inter-mediation by commercial banks.
Allied Bank’s director Ahadzi Kwame said they were eyeing the loans and would soon avail them to the business people after fullfilling Bank of Uganda’s conditions.
Ends