Bank of Uganda is the biggest bank in Uganda with a major role of overseeing the operations of banks in the country.
The global financial crisis demonstrated the disastrous effects of systemic risk to the stability of the financial system. Bank of Uganda’s mission is to “foster price stability and a sound financial system”. The Central Bank’s role in ensuring financial stability includes the following;
- Formulating macroprudential policies aimed at mitigating systemic risks to the Ugandan financial system;
- Undertaking continuous financial sector surveillance to identify potential systemic risks and conducting stress tests to determine the resilience of the system to plausible shocks and disruptions;
- Oversight of payment systems;
- Ensuring a good level of preparedness to manage a financial crisis. The Bank has developed a crisis preparedness and management framework as well as different types of support measures.
- The supervision and regulation of individual supervised financial institutions (commercial banks, credit institutions, microfinance deposit taking institutions, foreign exchange bureau and credit reference bureau) to ensure safe and sound financial institutions.
- Enhancing the efficiency of financial markets.
If any bank in Uganda violates rules set out by the government and the Bank of Uganda, the BoU will take stern action.The bank also ensures the currency is stable against other major currencies.