Uganda’s banking industry has received two new entrants – First Bank Uganda and Opportunity Bank Uganda.
Bank of Uganda (BoU) said in a statement on Friday that it had “issued commercial banking licenses to two financial institutions, bringing the total number of commercial banks in Uganda to 26.”
BoU granted the Commercial Banking (Class 1) License Certificates to Afriland First Bank Uganda Limited effective September 12, 2019 and Opportunity Bank Uganda Limited effective September 13, 2019.
The development will breathe new life in Uganda’s financial sector whose reputation recently suffered a setback over BoU’s resolution of troubled banks.
It also comes against the backdrop of widespread public concern over low private sector credit.
Despite strong economic performance since the early 1990s, Uganda’s financial sector remains shallow.
Governor Tumusiime Mutebile recently acknowledged that although large corporates have access to credit on more favourable terms, smaller firms in need of financing have limited options.
They often do not meet financial accounting standards that would facilitate access to long-term capital.
Opportunity Bank which previously traded as a Credit Institution (Tier 2), has now transformed to a Commercial Bank (Tier 1) institution.
Founded in Yaoundé in 1987, Afriland First Bank is the largest financial services group in Cameroon.
It has subsidiaries in the Democratic Republic of the Congo, Equatorial Guinea, Guinea, Liberia, South Sudan, São Tomé and Príncipe and Zambia.