BoU targets Shs 990bln in treasury bond auction to fund gov’t operations
KAMPALA, April 14, 2026 — The Bank of Uganda [BoU] has scheduled a treasury bond [T-Bond] auction worth Shs 990 billion on April 15, 2026, as the government intensifies efforts to mobilise domestic financing and attract long-term investors.
The auction, to be conducted in line with the Public Finance Management Act, 2015, will reopen three existing bond tenures, offering a mix of medium- and long-term investment opportunities.
According to the central bank, Shs 230bln will be raised through a three-year bond with a 15.55 per cent coupon, maturing on July 6, 2028. A 10-year bond valued at Shs 330bln will carry a 16.25 per cent coupon and mature on November 8, 2035, while a 20-year bond worth Shs 430bln will offer a 15.00 per cent coupon and mature on June 18, 2043.
The issuance underscores the government’s continued reliance on domestic borrowing to finance its budget, while also supporting the development of Uganda’s capital markets.
Long-term investors are expected to favour the longer tenures, partly due to more favourable tax treatment. The three-year bond attracts a 20 per cent withholding tax, while the 10-year and 20-year instruments are subject to a reduced rate of 10 per cent — a factor likely to appeal to pension funds and other institutional investors seeking stable returns.
Participation in the auction will follow strict central bank guidelines. Competitive bidding is limited to eight licensed Primary Dealer Banks: Absa, Citi, Centenary, dfcu, Equity, Housing Finance, Stanbic Bank, and Standard Chartered. The minimum bid under this category is Shs 200.1 million.
Other commercial banks and individual investors may participate through the Central Securities Depository via non-competitive bidding, with a minimum investment of Shs 100,000 and a cap of Shs 200 million per tenure.
Successful bidders will be allocated securities at a uniform price, determined by the lowest accepted price per 100, which corresponds to the highest accepted yield.
The auction will take place on April 15, 2026, with settlement expected the following day. Bids must be submitted by 10:00am on the auction day, although BoU reserves the right to adjust the amount on offer or reject applications depending on prevailing market conditions.
Market analysts anticipate strong demand, particularly for the longer-dated bonds, citing attractive yields and limited alternative long-term investment options.
The move comes amid sustained government borrowing, with treasury bonds continuing to play a central role in financing the fiscal deficit while providing relatively secure investment avenues.
According to the latest Performance of the Economy Monthly Report released by the Finance ministry, government in February 2026, raised Shs 1,613.17bln through two treasury bill [T-Bill] auctions and one T-Bond auction. Of this, Shs 615.98bln was generated from T-Bills and Shs 997.19bln from T-Bonds. A total of Shs 853.19bln was used to finance budget items, while Shs 759.98bln went towards refinancing maturing securities.
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