BoU warns of rising global risks as Uganda’s financial system remains resilient
KAMPALA, December 9, 2025 — Uganda’s financial system remains stable and resilient despite mounting global economic uncertainties, Governor of the Bank of Uganda [BoU], Michael Ating-Ego, said on Thursday during the 10th Meeting of the Financial Sector Stability Forum [FSSF] at Mestil Hotel in Kampala.
Ating-Ego commended the Forum’s member institutions for maintaining strong capital and liquidity positions over the past year, noting that domestic economic conditions, including stable inflation, steady activity, and improved private-sector performance, have supported overall financial stability.
“Our financial system has remained sound and resilient… These developments have helped keep key macro-financial vulnerabilities stable or moderate,” he said.
However, the Governor cautioned that global financial stability risks have intensified, citing stretched asset valuations, rising sovereign debt levels, geopolitical tensions, and uncertainty across international markets. He warned that these factors raise the likelihood of sudden price corrections and volatile capital flows that could spill over into Uganda.
Domestically, Ating-Ego highlighted progress in liquidity and funding conditions in Uganda’s financial sector but warned of persistent operational risks, including cybersecurity threats and fraud incidents within some of the financial institutions. Although incidents have declined, he stressed the need for continuous vigilance and stronger internal controls.
A key milestone of the year, he noted, was the successful Crisis Simulation Exercise, which tested Uganda’s readiness to manage systemic financial shocks and improved coordination among key institutions. He urged the Forum to closely examine the recommendations and follow-up actions needed to further reinforce the country’s crisis-management and resolution frameworks.
Atingi-Ego also pointed to advances in financial innovation, led by the Special Technical Working Group on Blockchain Technology, which has made progress in assessing use cases and identifying safe regulatory paths for emerging technologies.
Looking ahead, he said Uganda’s financial sector stands to benefit from new opportunities in sustainable finance, digitalisation, and regulatory moderniaation, but only if the sector remains vigilant.
“Financial stability is a dynamic, ongoing responsibility,” he emphasised. “The risks confronting us, whether global, domestic, technological, or institution-specific, require constant monitoring and decisive, well-coordinated responses.”
Ating-Ego concluded by thanking all participating institutions for their continued dedication to safeguarding Uganda’s financial stability, expressing confidence that the Forum’s work will continue to strengthen the resilience of the financial system.
Attendees at the forum included representatives from various financial authorities such as Deposit Protection Fund of Uganda [DPFU], The Financial Intelligence Authority [FIA], Insurance Regulatory Authority of Uganda [IRA], Uganda Retirement Benefits Authority [URBRA, and the Capital Markets Authority, among others.
The meeting focused on enhancing profitability in supervised financial institutions, the regulation of large Savings and Credit Cooperative Societies [SACCO by the BoU, and the necessity for regulation of virtual assets leveraging blockchain technology. The overall conclusion was that the financial system is sound and resilient.
https://thecooperator.news/the-financial-sector-can-be-profitable-principled-and-purposeful/
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