The Government of Uganda through Ministry of Finance, Planning and Economic Development has finalized plans to increase its shares in Housing Finance Bank (HFB), Business Focus reports.
The motion seeking to increase government shareholding in HFB from the current 45% was tabled before Parliament on Wednesday by David Bahati, the State Minister of Finance. Parliament tasked its Finance Committee to thoroughly scrutinize government proposal before giving it a green light.
HFB is 50% owned by the National Social Security Fund (Uganda). The Government of Uganda, through the Ministry of Finance, Planning and Economic Development, owns 45% in HBF. The remaining 5% is owned by the National Housing and Construction Company, a parastatal company jointly owned by the government of Uganda (51%) and the Government of Libya (49%).
It is worth noting that HFB had planned to list its shares on the Uganda Securities Exchange in 2012. However, those plans were postponed under unclear circumstances.
Under the stewardship of Mathias Katamba as Managing Director, HFB made a net profit of Shs18bn in 2016, up from Shs14.68bn in 2015.
Recently, a report by Parliament’s ‘Select Committee on UTL on the Management and Performance of UTL’ recommended that a forensic audit be conducted to establish if Finance Ministry has capacity to supervise companies where government has shares. This is because some of the agreements signed between the UCOM (majority shareholder in Uganda Telecom Ltd) and GoU were not favourable to Uganda. These agreements were signed under the watch of Finance Ministry and have played a big role in UTL’s poor performance. Currently, UTL that is under the care of a Provisional Administrator is indebted to the tune of over Shs700bn.