KAMPALA — Budadiri East Member of Parliament Hon. Julius Nakiyi has put Bank of Uganda (BoU) officials on the spot over the failure to recover more than Shs 140 billion linked to HABA Group, a private company that benefited from financial guarantees issued by the central bank nearly nine years ago.
The matter came to the fore during a sitting of the Parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) as lawmakers scrutinised Bank of Uganda’s financial statements for the financial year ended June 30, 2025.
According to the committee proceedings, lawmakers questioned how substantial financial guarantees could have been extended to commercial banks on behalf of a private entity without adequate collateral, potentially exposing public funds to significant financial risk.
Nakiyi Demands Accountability
Leading the interrogation, Hon. Julius Nakiyi questioned the central bank’s risk-management and oversight procedures, seeking explanations for how such a significant financial exposure could have been approved without sufficient security.
Nakiyi also questioned why the outstanding funds had remained unrecovered since the transaction was undertaken in 2017, demanding accountability from BoU officials over the prolonged delay in recovering the money.
The legislator pressed the officials to explain the steps taken to trace and recover the funds, as well as the measures put in place to protect public resources from similar financial exposures.
Bank of Uganda Cites Ministry of Finance
The Bank of Uganda team, led by Governor Dr. Michael Atingi-Ego, told the committee that the guarantees had been executed following instructions from the Ministry of Finance, Planning and Economic Development.
However, Nakiyi maintained that the central bank has a statutory responsibility to safeguard Uganda’s financial system and should ensure that transactions involving significant public financial exposure comply with the relevant legal and risk-management requirements.
He further questioned the pace and effectiveness of efforts to recover the outstanding money from HABA Group and its associated assets.
COSASE Demands Detailed Report
At the conclusion of the session, the COSASE committee directed the Bank of Uganda to provide a comprehensive report detailing the transaction, including the movement and tracking of the funds and relevant internal communications surrounding the guarantees.
The committee also raised questions about responsibility and accountability for officials involved in authorising the financial arrangements.
The parliamentary scrutiny is expected to provide further clarity on how the guarantees were approved, why adequate security was reportedly not obtained, and what action has been taken to recover the outstanding funds.
The HABA Group matter adds to wider parliamentary efforts to strengthen accountability within public institutions and ensure that public resources are protected from financial mismanagement and questionable exposures.
