There Is No Money to Finance Bailout — UDB

Uganda Development Bank has scared companies seeking for financial bail-out after revealing that they have no money.

The Uganda Development Bank (UDB) is cash-strapped and cannot provide funding to companies in financial meltdown seeking a government bailout.

According to the chairperson of UDB, Dr Samuel Sejjaka, the institution only has Shs100 billion in its treasury yet the bailout requires an exorbitant Shs1.3 trillion.

Sejjaka says currently the institution only has the capacity to lend out to small scale businesses.

There are also conflicting reports about whether a list of 65 companies was compiled so that the owners could benefit from this financial war-chest.

The list in of 65 companies has been the subject of media and public debate for a week but some companies on the list have denied being in any negotiations for a government bailout.

Businessman Patrick Bitature, Roofings Limited boss Sikander Lalali and Minister of Information & ICT Frank Tumwebaze claim that there is no substance to the alleged proposed government bailout.

What is certain however is that government has been considering the idea of bailing out ailing companies for some time.

According to documents sent by the Premier Ruhakana Rugunda to the Finance minister, one of the measures he recommends for the bailout is to enlist UDB to restructure loans.

During the State of the Nation address in June this year, President Yoweri Museveni spoke of the need to recapitalize UDB to the tune of Shs500 billion.

While at the National Leadeship institute, Kyankwanzi, President Yoweri Museveni says the government will bail out a few struggling companies like those that supplied goods and services to South Sudan

Source: NTV Uganda