The Bourse USE 10th AnniversaryMagazine Nov 2008

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Foreword by the Governor,

Bank of Uganda
also lent support to the growth of the stock
exchange. In addition, since 2004, the Bank of
Uganda has also issued long-term bonds of 2, 3,
5 and 10-year maturities, which have provided
the critical yield curve, that acts as a benchmark
for corporate fixed income instruments in the
capital market.
his publication commemorates ten years

of the existence of the Uganda Securities Exchange (USE). Since 1998 the USE
has grown from a small start-up mart
to a platform with an average market capitalization of four trillion shillings in 2008, with
thousands of stakeholders in the listed entities.
I wish heartily to congratulate the USE on their
accomplishments over the years in spite of the
challenges typical of a nascent market.
Over the past 10 years, Uganda has recorded high
rates of economic growth underpinned by sound
and coherent macroeconomic policies. The Bank
of Uganda policies supporting this macroeconomic environment have centered on preserving
price stability, deepening the financial system
and ensuring the safety and soundness of Financial Institutions. The Governments policy of
privatization program has also helped to support
the growth in the number of equity listings on
the USE.
I note with satisfaction the growth in the

number of companies listed on the USE to
nine, the increase in volume traded from
Shs.120million in 2000 to Shs.86.25billion as at
the end of October 2008 and the average capitalization of Shs. 4trillion as at the end of October
2008. The Government privatization programme
The Bourse Celebrating 10 years of Use
The USE has also played an important role in providing an efficient, well regulated platform that
has made the investment process in equity and
fixed income instruments, simple, affordable and
transparent. The listed companies must also be
commended for the enormous efforts they have
undertaken to comply with extensive corporate
governance requirements and triple bottom line
reporting which have boosted investor confidence and participation in our capital market.
Bank of Uganda is committed to ensuring
sustained macroeconomic stability by implementing prudent macroeconomic policies. It is
our conviction that sustained macroeconomic
stability provides a conducive environment for
sustained economic growth and the deepening of
the financial system.
I wish to highlight some critical factors for the
continued success of USE. First, there should be
steadfast commitment to taking a regional and
global view for purposes of entrenching and ensuring that our capital market is robust. Second,
it important to ensure that the regulatory, supervision and enforcement structures are responsive
to the advantage of todays market place. Last,
but not least, is the urgency to automate the
trading, clearing and settlement systems and
processes of the USE.
E. Tumusiime-Mutebile
Governor
BANK OF UGANDA
In 1994 Bank of Uganda chaired the Capital Markets Development Committee
(CMDC), which was comprised of stakeholders of capital market interests from nancial
markets, industry and government.
The CMDC oversaw the introduction of the Capital Markets Statute 1996 which
introduced the Capital Markets Authority (CMA) and made provision for the licensing
of the Uganda Securities Exchange.
The CMDC worked with Government to adopt a strategy of privatizing parastatals by
listing them on the Stock Exchange.
So far 6 companies have been listed on the Uganda Securities Exchange all former
parastatals.
Bonds have also provided an additional saving instrument and have deepened the capital
market. Auctions for Treasury Bonds were introduced in January 2005. Treasury Bonds
are auctioned every 28 days. The bonds support monetary policy implementation by
improving liquidity management and promoting market development.
These securities also assist in providing a framework for pricing of securities in the
secondary market. Uganda Securities Exchange has raised over 1.7 trillion Ushs from
Government bonds.
We are proud to be associated with the Uganda Securities Exchange.
Message from the Chairman
e welcome you all to

celebrate with us the
USEs 10th anniversary. It
gives me great pleasure to
present to you the Bourse Magazine
a souvenir publication commemorating
this anniversary. We hope to use this
occasion as the launch pad of a new
era on the Exchange, which marks the
growth of the USE from the start up
mart into a fully fledged stock market.
We intend to use the celebrations to
showcase the USE and market it not
only as a regional but also as a global
frontier for investment capital. Finally
this celebration will be used to recognize and acknowledge our stakeholders
who have supported and continue to
support the Exchange.
The 12th African Securities Exchanges Association (ASEA) Conference
We are honoured to host the 12th
ASEA Conference and Annual General
Meeting while commemorating our
10th anniversary. The theme for the
conference is: AFRICA ON THE MOVE
Capital Markets Driving Economic
Transformation. The ASEA which
was founded in 1993 today boasts of
a membership of 29 members from
African Stock Exchanges. Among the
key objectives of ASEA are: to provide
a forum for mutual communication,
exchange of information, cooperation
and technological assistance among

its members; to facilitate the process of financial integration within the
region for the effective mobilization
of capital to accelerate economic
development of Africa. ASEA supports
its members in the establishment of
Stock Exchanges and the development
of financial instruments. The Association also assists in promoting the
development of standards of training
and professionalism amongst members
and other market players, standards
of listing, trading and settlement of
securities, the products and services
of Africas capital markets as well as
the establishment of a data bank and
information system. Together with
enhancing member exchanges joint
programs, the association also aims to
harmonize standards for market principals on the continent. It is therefore
fitting that the USE should host ASEA
on the occasion of its marking its 10
years of existence.
Product Development
Following the listing of its maiden
instrument the EADB bond in January
1998, USE has over the past decade
posted tremendous growth in terms of
listings on the USE, growth in market
capitalization, share holder growth
and activity turnovers. To date the USE
boasts of 9 equity listings, 6 corporate bonds and 30 Government bonds.
Over the past decade USE has raised
over Ushs. 103bn from Equities, over
Ushs. 90bn from Corporate Bonds and
over Ushs. 1.7trillion from Government
bonds. The number of share holders
has also increased tremendously in
the recent years in terms of participation at the Initial Public Offers (IPOs)
and in the secondary market activity
on the USE. To date the USE market
capitalization stands at Ushs. 5.8 trillion registering an impressive growth
in market capitalization over the years

from an initial market capitalization
of Ushs. 2.3bn registered following
the listing of its maiden equity listing
Uganda Clays Limited. The listings on
the USE have largely been a product of
the Privatisation program meaning the
challenge for the coming years will be
to attract listings from privately held
and family owned businesses.
Market Performance
Over the 10 years, USE has recorded a
gradual growth in turnover levels with
modest volumes recorded in the first
half of the decade followed by a slight
pickup in volumes during the early
part of the second half of the decade
and a dramatic rise in turnovers in the
last part of the past 10 years. There
has been a tremendous improvement
in investor participation in the market
from both local and foreign investors.
The increase in investor numbers on
the USE is attributed partly to the
continued education and awareness
campaigns by the USE, capital markets
incentives and other the investment
policies that have been put in place
by the Government in an effort to
promote long term savings and investments. This has been complimented
by the conducive macro economic
and socio political stability that has
boosted investor confidence in the
capital markets.
Outlook
I am confident that with strong economic growth across the East African
region coupled with macro economic
and political stability, the USE will
continue to register impressive growth
in turnovers and market capitalization.
Going forward, Automation of the USE
systems will create the platform for
further growth and development of the
Exchange. Regional integration will
iii
Message from the CEO

ing our domestic savings rates and
reducing the cost of funding on
local capital as key components for
our nations priorities in its objective of achieving economic growth
and social transformation.
be enhanced now that the Securities

Central Depository (SCD) Bill has been
passed by Parliament paving way for
the full automation of systems and
processes of the USE which will allow
for the eventual integration of the
trading platforms across the continent
of Africa.
Appreciation
The last 10 years have been years of
milestones and I would like to thank
all our partners and stakeholders who
contributed to building the USE to the
institution that it is today. Special
appreciation go to our Regulator, the
CMA, Ministry of Finance, Planning
and Economic Development, Privatization Unit, Bank of Uganda, our
Member Firms, Listed entities, Nairobi
Stock Exchange, Dar es Salaam Stock
Exchange, Donor partners specifically GTZ, SIDA, British Council, DFID
and IFC, to mention but a few, who
have played a major role towards the
success story of the USE. Last but
not least, I would like to thank my
colleagues on the Governing Council,
Management and the staff of the USE
for their dedicated commitment to the
USE 10year success story.
In conclusion I would like to thank you
all for your support. Your finding time
to read our Souvenir magazine is ample
evidence of your support and will
indeed make it a treasured publication
for our celebrations. I wish our ASEA
delegates a fruitful conference and a
memorable visit to our country Uganda
The Pearl of Africa. May God Bless
You All.
For God and My Country
Samwiri H.K. Njuki
Chairman
Governing Council
iv
am extremely delighted to
be associated with our tenth
year anniversary as a Securities Exchange business
in Uganda. In the last ten years
we have attempted to conform to
the standards required for capital
market development take off. In
this regard, I am happy to report
that USE has adopted international
standards of regulations, listed local
equity products, listed corporate
bond products, cross listed regional
equity products, traded, cleared
and settled billions of shillings,
provided training and public awareness programs, launched a new
website, been appointed as the ISIN
numbering agency for the country
and been actively engaged in the
pension and social security reform
initiatives. I believe that under
the circumstances USE has been
extremely successful in meeting the
minimum objectives that we set out
to achieve. However, it is important
to note that the state of affairs prevailing at the USE today is in fact a
reflection of the conditions of our
domestic financial sector. Being
pioneer practitioners in our nascent
financial markets in the last ten
years has brought the realization
on the importance of deepening our
domestic financial sector, increas-
What next for USE?

USE will continue to champion
domestic capital formation in
our jurisdiction while promoting regional integration. USE will
continue to disseminate information about the economy and tell our
story on domestic financial markets
to potential investors. USE will
continue to be a small and efficient
client centric organization that encourages investment in our financial
markets. We indeed look forward to
the next years of consolidation and
financial market deepening.
Appreciation
I am grateful for the support and
guidance extended to me by the
Chairman and members of the
Governing Council, the Privatization Unit, Ministry of Finance and
Economic Planning, CMA, Bank of
Uganda, SIDA/GTZ, our listed entities and all our thousands of investor stakeholders. I would also like
to take this opportunity and thank
the USE staff for their dedication,
hard work and commitment throughout these last years. Finally let me
commit the unwavering support of
USE in the challenge of our nation
in deepening our domestic financial
sector.
Simon Rutega
Chief Executive
Uganda Securities Exchange
Japheth Katto, Chief Executive Officer, Capital Markets Authority
Building the Blocks of

Capital Markets Development
n behalf of the Capital Markets Authority let me take

this opportunity to congratulate the Uganda Securities
Exchange (USE) on this auspicious
occasion of its tenth anniversary.
The last decade seen the Ugandan
market grow by leaps and bounds. It
has witnessed a substantial increase
in trading volumes at the USE and
an increase in both equity and debt
listings. Governments commencement
of bond issuance has also provided a
pricing benchmark for corporate debt
instruments. Additionally, it is during
this decade that we have seen the
emergence of collective investment
schemes in our market.
This remarkable performance has,
however, not been comparable to other
developing markets in Asia and Latin
America. If USE is to compete favorably
with these markets it has to continue to
aggressively pursue the regional integration agenda with her counterparts in
Kenya, Tanzania, Rwanda and Burundi.
We salute the progress made so far on
this front through the East African Stock
Exchanges Association (EASEA). As a
member of the East African Securities
Regulatory Authorities (EASRA) we
are committed to supporting EASEAs
initiatives through the development of a
harmonized regional legal and regulatory
framework which will provide an enabling environment for the integration of
the East African stock markets.
CMAs mission is to regulate and promote a robust, transparent, fair and
efficient capital market in Uganda. To
this end CMA has developed a robust
legal and regulatory framework to ensure that investors in Ugandas capital
markets are protected while at the
same time facilitating the development of capital markets in Uganda.

We are currently in the process of
amending the Capital Markets Authority law to keep in tandem with the
international best practices. We have
also applied to become signatories
to the International Organization of
Securities Commissions (IOSCO) Multilateral Memorandum of Understanding
(MMoU). The IOSCO MMoU is designed
to foster information sharing and regulatory co-operation among securities
regulators across the globe to enhance
investor protection and efficiency in
the securities markets.
Looking forward to the next decade, the
USE should set its sights to the development of market infrastructure and market growth through regional integration.
The passing of the Central Securities
Depository bill therefore sets the stage
for the transition from a manual to an
electronic trading, settlement and clearance system. This will greatly improve
the efficiency and liquidity in the market
thereby placing the Ugandan capital
markets at the same footing with her
counter parts in Kenya and Tanzania.
All the above developments have not
been devoid of challenges. One of the
most pressing challenges facing the
capital markets in Uganda is a low
level of awareness about the capital
markets. The CMA has just completed
its 3-year public education strategy,
which builds on the successes we
have had so far in this area, like the
secondary schools and university programmes. We believe this strategy will
effectively guide CMA in working with
the various stakeholders in the capital
markets industry to increase the levels
of awareness about the capital markets
in Uganda.
A small institutional investor base is

also another big challenge we have
faced as we build the capital markets
industry in Uganda. Institutional
investors are the backbone of capital
markets the world over and Uganda
is no exception. The Ugandan institutional investor base comprises of
a few occupational pension funds
dominated by the National Social
Security Fund (NSSF). CMA with other
key stakeholders in the capital markets
industry have been at the forefront
of advocating for the reform of the
pension sector which would result
in the widening of the institutional
investor base and the deepening of our
financial sector. We gladly welcome the
latest developments in the pensions
sector where different stakeholders
are now discussing the possibility of
a pensions regulator who will also
oversee the eventual liberalization of
the pension sector. It is intended that
the pensions regulator will be in place
by the end of 2008.
Challenges are only stepping-stones
to greater achievements. Thus, the
challenges of the last 10 years have
only emboldened us to press on for
the greater exploits that lay ahead
of us. The potential of the capital
markets in Uganda is limitless and we
are well on our way to becoming the
center of choice for capital raising
and investment.
Once again, I wish to reiterate CMAs
commitment to the growth and development of the capital markets in
Uganda. We commend the board, management and staff of USE who have exhibited a high level of professionalism
and resilience throughout the 10 years
of USEs existence. We wish the USE
many more years of continued growth.
v
Message from the ASEA President
CONTENT
Governing Council Members....................... 8

Milestones - The Journey of USE................11
Africa as an Investment Destination........ 15
Global Financial Crisis and
African Stock Exchanges..........................16
Corporate Governance.............................. 18
Impact of USE......................................... 20
Stock Brokerage firms
MBEA Brokerage Services (U) Limited........24
Renaissance Capital Limited......................26
African Alliance Securities...................... 28
Companies Listed on USE
Bank of Baroda Uganda............................ 30
DFCU Ltd.................................................32
New Vision Group.................................... 34
Stanbic Bank Uganda............................... 36
Uganda Clays Limited.............................. 38
National Insurance Corporation................ 40
Statistics................................................ 42
The bourse is a
Uganda Security Exchange
Plot 1, Pilkington Road, Workers House, 2nd Floor,
Northern Wing
P.O. Box 23552, Kampala, Uganda
Tel: +256 - 414 - 343-297, 342-818, 343-297 +256 - 0312
- 370-815, 370-817, 830-818, 370-841; Fax: +256 - 414
- 342-841; Website: www.use.or.ug
10 years celebration publication produced by
Magazine Centre P.O. Box 9350 Kampala, Uganda
Tel: +256 312 278849 / +256 (0)752 585000
Email: info@magazinecentre.info
All rights reserved. No part of this publication may be
reproduced, stored in a retrieval systems, electronic,
photocopy, recording or otherwise, without permission in
writing from Uganda Securities Exchange. Uganda Security
Exchange does not accept responsibility for advertising
contents or the opinion expressed by the respective
contributors.
2008 Uganda Securities Exchange
frica, the second largest continent in the world after Asia, with
almost 900 million people in 54 independent states, has always
been known with its richness in mineral and natural resources,
leaving it with enormous growth potential, yet still vastly
untapped.
Since the beginning of the new millennium, the average economic
growth rate recorded almost 5 % with a real per capita income rising by
4.3 %. Even though this average growth rate is not equally distributed
on the continent; owing to the high performance of North and Southern
Africa countries, and is still far from the 7 to 8% target needed to enable sustainable poverty alleviation in Africa, an increasing number of
countries are riding on that growth path.
Stock exchanges, in their turn, have been perceived as the
backbone of most economies, serving a critical need in raising capital
for companies at a reasonably low cost as compared to other sources of
finance such as banks.
The creation of capital markets in the African continent, was initially made under the impetus of the political will, to mobilize national
resources and channel them to productive investments, towards deriving the economic and social growth of the continent. African exchanges
have also served as a platform for the privatisation wave that took place
across Africa.
African markets have developed over the years, whereby the
number of stock exchanges in Africa has almost doubled since 1993 to
reach 23 exchanges with the aggregate market capitalization increasing
ten folds over that period to record USD 2,170 billion, albeit still representing less than 2% of the world market capitalization.
Moreover, African Equities offer a superior risk/return profile,
which is usually not affected by trends in the developed markets, and
provides quite attractive Price/Earnings ratios.
In 2007, the FDI flows to Africa accounted for USD 36 billion,
which is double of that achieved in 2004, reflecting a growth in the
appetite of the international investment community for the African
countries, despite the concentration on few sectors including oil and
mining products.
From another perspective, Africa has witnessed some regional
initiatives in the West, East, South and Central Africa. This integration
simply means that any financial institution in Europe or America (interested in investing in Africa), will find it easier to do business in these
regional stock market blocs, FDI will grow as a result. More importantly,
it will be easier for issuers in countries within blocs to raise capital in
the region to expand their business, thereby bringing market capitalization in line with other well established emerging markets, which in turn
would generate a higher foreign interest.
Finally, the fast change in the exchange industry, driving globalization and market consolidations have pressured African markets to
upgrade their technology infrastructure, increase efficiency as well as
widen the range of their products and services, to be able to support
their organizations growth and compete in the domestic and international markets.
Mr. Maged Shawky
President ASEA
Libyan Stock Market

The Libyan stock market (LSM) began trading on April 3
economy and the sustained growth of the country`s di-
of this year with five companies . two more companies
verse economic sectors, the chairman of the LSM is ex-
have since listed on the exchange, which now has a total
pecting diversity to be reflected in the index, both by
market capitalization of approximately $1 billion and an
Libyan companies seeking to raise capital via the ex-
average daily turnover of about 300,000 Libyan dinar or
change and by the increasing number of foreign players
$244000 .
entering the country through joint ventures, who are

expected to list.
The index is currently composed of banks and financial

services companies, including Sahara bank and Wahda
The LSM was initially set up as an office at the central
bank, both of which were privatized via the LSM and the
Bank of Libya (CBL) which began trading shares in 2003
Economic and social Development Fund. Libya`s public
. In 2006, Mr. Alshahomy got the green light from offi-
sector commercial bank, Gumhouria Bank and National
cials to make the stock market independent from the CBL,
commercial Bank, are among the seven entities being
to develop a sound regulatory framework, IT infrastruc-
prepared for upcoming initial public offering (IPOs) by
ture and build up its human resources. The LSM now has
seven of the fifteen Libyan stock brokerage firms that
offices in Tripoli and Benghazi, and has taken the best
have opened their doors in the last year .
aspects of world stock markets in developing a flexible
With the increasing liberalization of the Libyan
operational structure.
CONTACT
Benghazi- Alshatea Street Hai Aljazeera (Juliana)
Nearest Alfadl Hotel. Teipoli- Omar Almoktar st
Tel:+218213365050 Fax+218619091097
website: www.lsm.gov.ly
Membership
LISTED COMPANIES
LSM is a member of following organizations:
Status
Company Name
Union of Arab capital markets.
Trade
Wahda bank
AMEDA
Trade
Sahara bank
ANNA
Trade
Bank of commerce & develpoment
African Securities Exchange Association
Trade
Assaray trade and investment bank
Profile
Non - trade Gumhouria bank
Chairman
Mr. Suliman Alshahomy
Non - trade Altejari bank.ly
Capital
50 M Libyan Dinnar
Trade
Libya insurance .co
Currency
Libyan Dinnar
Trade
United insurance .co
Market Regulator
Libyan stock market
Trade
Sahara insurance .co
Year of establishment
2006
Products
Stocks
10 Non - trade Alenma company for engineering industries

11
Agreements
Signing an understanding note with NCDX Exchange in
India 2007
Signing an understanding note with MCX 2007
Signing cooperation agreement with London Stock
Market 2007
Signing a conduct agreement with Reading university
2007
Non - trade Development extraction and refining

vegetable oil company
12 Non - trade Alenma kllre and cable .co

13 Non - trade Alenemaa pipe company
14 Non - trade Inmae company for pipe manufacturing
15 Non - trade The joint stock national company for
flour mills and fodder
16 Non - trade Ahlia cement company
Sectors Traded
Sectors traded on the LSM are:
Banks
Insurance companies
LSM Index Movement from 3/4 to 20/10/2008
1300
Ongoing Plans: In 2009, we expect to focus on the following:
1200
1100
1000
1) Encourage foreign investors to trade in LSM.
900
2) E Trading
800
3) Establish the commodity exchange.
700
/08
23/10
/08
13/10
/08
03/10
/08
23/09
/08
13/09
/08
03/09
/08
23/08
/08
13/08
/08
03/08
/08
23/07
/08
13/07
/08
03/07
/08
23/06
/08
13/06
/08
03/06
/08
23/05
/08
13/05
/08
03/05
/08
23/04
/08
13/04
/08
5) Intensive training programs for the LSM employees
03/04
4) Intensifying public awareness/education.
CLEARING AND SETTLEMENT:

Settlement Cycle T+3
Delivery Versus Payment (DVP)
Participants in the Settlement process:
- Settlement Banks: Al-Wahda Bank and Bank of Commerce and Development.
- Brokerage Firms: 14 firms.
- Custodians: the LSM is currently playing the role the custodians.
Settlement Guarantee fund to ensure the settlement of the executed trades.
DEVELOPMENT OF THE PERFORMANCE OF THE LISTED COMPANIES SHARES

Company
Nominal
Value
Market Cap
Number Of
Share
Open Price
03-04-2008
Open Price
15-06-2008
Close Price
20-10-2008
Changs
Price
Changs
Value
Wahda Bank
108,000,000
237,600,000
10,800,000
16
21.2
32.50%
120%
Sahara Bank
252,000,000
531,468,000
25,200,000
10
18
80.00%
111%
17%
Bank of Com & Dev
50,000,000
58,476,730
5,000,000
10
11.86
18.60%
Assara Bank
33,333,330
30,466,664
3,333,333
10.39
7.9
-23.97%
-9%
Sahara Insurance
15,000,000
26,250,000
1,500,000
16
17
6.25%
75%
Uinted Insurance
10,000,000
17,000,000
100,000
145
170
17.24%
70%
Libya Insurance
50,000,000
105,000,000
10,000,000
10.3
47.14%
110%
Governing Council Members to date
Mr. Onegi - Obel

Board Member 1998 todate
and Chairman from 1998 - 2006
Made in Africa (IB) EA Ltd
Mr. Michael Opagi

Board Member 2002 to 2007
Acting Chairman 2006 - 2007
Director, Privatisation and
Utility Sector Reform Project
Mr. Samwiri Njuki

Chairman 2008
Director, Equity Stock Broker
(U) Ltd.
Mr. Simon Rutega

and Chief Executive
Uganda Securities Exchange Ltd.
Mr. Andrew Owiny

Executive Director
MBEA Brokerage Services (U) Ltd.
Mr. David Scholtz

Crane Bank Financial Services
Ltd.
Mr. Sateesh Babu

Equity Stockbrokers (U) Ltd.
Mr. K.K. Khare

TransAfrica Finance & Securities
Ltd.
Mr. Benjamin Kabiito

Board Member 1998- 1999
Dyer & Blair (U) Ltd.
Mr. R.B. Nerurkar

Board Member 1998- 1999
Baroda Capital Markets (U) Ltd.
Mr. Ezra Mutabazi

Uganda Commercial Bank Ltd.
Mr. P Bhutani
Board Member 1999-2002
10
Mr. Francis Kakurungusi

Board Member 2002
General Manager
Crane Financial Services Ltd
Mr. Ketan Morjaria

Board Member 2002
Chairman Orient Bank
Equity Stock Brokers (U) Ltd
Mr. Moses Kibirige

Board Member 2008
Managing Director
DFCU Bank
Mr. Robert Warlow

Board Member 2003 - 2006
Managing Director
Crane Financial Services Ltd
Dr. Ram Jass Yadav

Board Member 2003 - 2006
Mr. Mark Horwood

Board Member 2008
Equity Stock Brokers (U) Ltd
Mr. Rajesh Khana

Board Member 2007 - onward
Mr. A. R. Kalan
Board Member 2007 - onward
Crane Financial Services Ltd.
11
Paul Busharizi Business Journalist
Milestones
The Journey of USE
The Uganda Securities Exchange started trading with the ring of a bell on a grey morning in January
1998 at its original home on the ground floor of the East African Development Bank building.
The event was the listing of the USEs first security, the 10 billion shilling East African Development
Bank bond.
inance minister Gerald Sendaula told a suitably underwhelmed media on the occasion, that the launching of the
exchange is a significant step
in the countrys plans to generate resources for development.
The event did not make the front
page headlines but it was the first step in
a thousand mile journey.
Another bond the PTA Bank bond
was listed 15 months later before the first
listing of a company stock, Uganda Clays
Ltd was floated in 2000.
Since then BAT, Bank of Baroda,
dfcu, New Vision and Stanbic Bank in
that order, have listed their shares.
There has been growing inter-
est with every subsequent listing with

oversubscription peaking at 200 Percent
with the Stanbic offer compared to a 15
percent oversubscription on the Uganda
Clays issue.
In the case of Uganda Clays and
New Vision, both companies have returned
to the market with rights issues in 2008 to
source funds for business expansion.
Uganda Clays and Bank of Baroda
have also been involved in share splits,
which broke shares down into more affordable wholes, while increasing the
number the shares on offer.
In the meantime there has also
been a number of cross listed companies
companies listed on Nairobi Stock Exchange and also in Uganda. East African
Breweries Ltd first cross listed in March

2001, was followed by Kenya Airways the
following year and Jubilee Holdings Ltd
in 2006.
The listing of government bonds
starting with the two-year treasury bond
in January 2004 opened the gates for the
eventual listing of 31 bonds on the exchange.
Ten years on from that first listing,
the USE is still around.
The definition of victory is different
for everybody. There have been numerous
advances made by the exchange that it
still exists on not being the least of these,
but the two events that will stand out are
the listing of Stanbic Bank and the ongoing collapse in share prices, an extension
The Licensing of
the USE by the
Capital Markets
Authority
of Uganda to
operate as an
approved Stock
Exchange
The listing of USEs first
security, the Ushs 10 billion 4
year East African Development
Bank (EADB) Bond
Jun 1997
Jan 1998
The listing of the 5

year Ushs 8.3 billion
PTA Bond
Mar 1999
The flotation and eventual listing

of USEs first equity, the Uganda
Clays Ltd share. UCL shares were 15%
oversubscribed.
18 Jan 2000
13
Role of Privatisation Unit

The Privatisation and Utility
Sector Reform Project (PUSRP) was
established in 2001 as a follow up
project from Enterprise Development
Project II (EDP) which ended in
2000. The project is a government
of Uganda reform and divestiture
initiative, which is part of a wider
economic reform and recovery
program initiated in the late 1980s.
The project development objective is
to improve the quality, coverage and
economic efficiency of commercial
and utility services, through
privatisation, private participation in
infrastructure (PPI), and an improved
regulatory framework.
To date 122 Public Enterprises
(PE) have been divested leaving a
balance of 36 enterprises, yet to be
divested.
Of the 122 divested companies,
6 were privatised through the
Uganda securities Exchange. These
were amongst the most profitable
state enterprises thus giving the
public an opportunity to benefit from
these blue chip companies.
The Privatisation Unit will
be privatising more through the
stock Exchange in the coming period
starting with National Insurance
Corporation in 2008.
Uganda Clays Listing The 1st day of trading on USE floor

of the worldwide financial crisis.
In January 2007 Stanbic Bank
was listed on the USE.
The 70 billion shilling initial
public offer of one billion shares that
preceded the listing, was not only the
largest listing in Ugandas history but
the offer was oversubscribed three times
over. Refunds totalled about 140 billion
shillings.
Single handedly the Stanbic is-
sue dragged the USE out of infancy.

In the first quarter of the 2007,
when Stanbic started trading, turnover
on the exchange was three times higher
than the turn over registered in all of
2006 and more than the accumulated
turnover on the bourse since 2000.
Stanbic accounted for more than 90
percent of the trading.
The Stanbic offer also increased
the number of individual sharehold-
The first ever cross border

listing in the East African
market occurred with the
listing of East African
Breweries Ltd (EABL) on the
USE on 27th March. EABL is
ranked among the top 10
companies on the Nairobi
Stock Exchange (NSE) in terms
of capitalization.
The flotation of the British

American Tobacco (Uganda) Ltd
BATU share through the USE on
28th June. BATU shares were 5%
oversubscribed and represented
the second divestiture of
government held shares in a
company to take place through
the Exchange
28 Jun 2000
14
The listing of the Kenya

Airways share on the USE on
the 28th of March becoming
USEs second cross listed
product. The shares currently
have Blue chip status on the
Nairobi Stock Exchange (NSE).
27 Mar 2001
28 Mar 2002
The first flotation of a

commercial banks shares in
Uganda occurred on the 2nd
September, 2002 when Bank
of Baroda offered 20% of its
stock to the public through
the USE. 80million shares were
on sale in multiples of 100 at
Ushs 600 per share. Its shares
were 16.7 % oversubscribed
(making it the best response
so far)
2 Sept 2002
The Regulator
Capital Markets Authority
The Capital Markets Authority (CMA)
was established in 1996 following
the enactment of the Capital Markets
Authority Statute 1996. It is an
autonomous body responsible for
promoting, developing and regulating
the capital markets industry in
Uganda, with the overall objectives
of investor protection and market
efficiency.
The CMA is governed by a
Board of Directors, which formulates
policies for the Authority.
From the start, the CMA
adopted a licensing policy designed
to ensure that capital markets in
Uganda will have the capability to
mobilize savings from domestic,
regional and international markets.
In this regard, CMAs licensing policy
concentrates on the following three
criteria:
Investor protection
Financial viability
Potential to develop the securities
market
There are currently 24
Licensees including 1 stock exchange,
10 broker/dealers, 5 fund managers,
1 unit trust manager, 1 unit trust
trustee and 22 investment advisors.
The Uganda Securities
Exchange Limited was approved by
the Capital Markets Authority in
June 1997 as the only approved stock
exchange in Uganda. This became
the 17th licensed Stock Exchange in
Africa. The members of the Exchange
are from the private sector.
ers more than ten fold to about 35,000

shareholders. Since its entrance onto
the exchange Stanbic has continued to
dominate trading and direct the mood
of the exchange.
So in one swoop the Stanbic
had increased, the number of individual shareholders, foreign interest
in the USE and general activity on all
counters creating wealth for many and
lulling investors into a false sense of security.
That was until this years share
collapse, a cold Uganda has contracted
when world financial system went into
crisis.
So what is this financial crisis
and how has it affected the USE?
The current financial crisis has
its roots in mortgage lending by banks
in US to people who were not credit
worthy and eventually defaulted on
their loans. This would have remained
an isolated American problem had the
banks not bundled these questionable
mortgages and used them to back bonds
that were sold to institutional investors
all over the world.
So when the mortgages went sour
there was a domino effect the extent of
which is not wholly known even today.
The ensuing distress to investment banks and companies closest to

the collapse has had the added effect of
creating panic in the market and sending investor fleeing out of more risky
assets like equities into cash and government bonds.
Investors are now rescinding
commitments to invest more in African
markets or worse still pulling out all together depressing share prices from the
Johannesburg to Cairo.
African equity markets are taking a hit for a crisis not of their making
and the USE has not gone untouched.
The USEs All Share Index a
measure of market activity, fell more
than 30 % from a December close of
1,052.8 to 712 at the end of October,
costing investors hundreds of billions of
shillings in the process.
Our biggest issue Stanbic did not
go unscathed. From an opening price of
150 shillings a share, which was double the IPO price of 70 shillings the,
counter has risen to as high as 255 shillings in March before being pummeled
by poor sentiment to trade for as low as
130 shillings in October.
Industry players say on the whole
price falls are a result of lower foreign
The Launch of the USE All

Share Index
Official listing of
Bank of Baroda
Uganda Ltd (BOBU)
on the USE on 14th
November making
it the first financial
institution to list
on the USE
14 Nov 2002
The listing of the first

tranche (Ushs 24 billion)
of the Ushs 54 billion UTL
Medium term Note on 16th
September.
16 Sept 2003
Official Listing of the 2 year, Ushs

20 billion Uganda Government
20% Coupon Rate Treasury Bond
on January 15th making it the first
Government Bond to be listed on
the USE. Currently there are two
2 year bonds, two 3 year bonds,
a 5 year bond and a 10 year bond
listed on the stock exchange.
23 Oct 2003
15 Jan 2004
DFCU group goes public making

it Ugandas second financial
institution to do so
14 Oct 2004
15
SBU largest listing in Ugandas history was oversubscribed by 300%

institutional involvement in the second
half of this year, as institutions adopt a
wait-and-see attitude on how the current
crisis will play and how it will affect Africa. With a diminished interest in the USE
retail investors have had a run of the field
depressing prices on small volumes.
In a ten-year cycle its probably fitting that the USE has tasted both sides of
the cycle. The bourse and its investors will
be the better from the experience, regardless of the money lost as they will have the
test of their first market crash.
After 10 years the exchanges managers are allowed some back patting.
We had a nascent financial market with only short term instruments.
Ten years later, we have nine equities, 31
government bonds, seven corporate bonds
with a population sensitized about capital
markets, Simon Rutega said in a recent

press interview.
In the immediate future the USE is
looking to the listing of the National Insurance Corporation and the cross listing
of KCB and Equity banks from Kenya. In
addition corporate bond issues by Stanbic
Bank and National Water & Sewerage are
in the pipeline.
But challenges abound if the exchange is tom play a meaningful role in
Uganda and Africas development agenda.
The bourse still has to attract private companies to list on the exchange as
well as increase awareness and educate the
public about its activities.
I am optimistic they will list because the need to raise more capital on the
market will be come more paramount,
Rutega said.
To give the extent of the thousand
mile journey still ahead for the USE, in
February 2007 the 216 year-old New York
Stock exchange recorded its largest volume
of 4.1 billion shares traded in a single day.
A far cry from the record 8,500
shares average daily shares traded in 1835
which at the time was the a fifty fold
jump from the daily averages of seven
years previously.
Stanbic Bank Uganda is

listed on the USE on 25 Jan
following a successful IPO that
was 200% over-subscribed.
New Vision offers 20% of

its shareholding for sale
to the public, making it
the fifth local company
to conduct an IPO in the
Ugandan market. NVL is
officially listed
16 Dec 2004
16
The listing of the 8 year East

African Development Bank
(EADB) Bond
Dec 2005
Official cross-listing of Jubilee

Holdings Limited (JHL) on
the USE on 14th February
making it the first insurance
institution to list on the USE
14 Feb 2005
25 Jan 2007
Gary Watson, Executive Director African Alliance
Africa as an Investment Destination
any investors look at

Africa as an investment
destination through the
lense of conventional
investment appraisal.
One way to look at any
investment is to analyse past performance.
On recent past performance Africa looks
great. Strong local currencies, a global
commodity boom and a political stability has seen tremendous growth in inward
investment into Africa. A longer-term
investigation of Africas investment performance is more sobering. Africa has not
lived up to its potential and many pundits
quote the growth of East Asia versus Africa in post-colonial times as evidence of
this underperformance.
Africa as an investment destination remains risky in relative terms. Why
risky you may ask? Political risk is a fact
of life, look no further than South Africa.
A robust democratic process has created
uncertainty and investors do not like uncertain outcomes especially when economic ideology and policy may change
as a result. African stock markets are
generally small, illiquid and can impact
quite heavily on returns. Volatile currencies, undiversified economies and a cumbersome commercial judicial regime all
make investment in Africa risky by global
standards; however the potential returns
compensate this risk taking.
The key to appreciating Africas
investment potential is not uncovered in
extensive backward-looking analysis. Its
looking at the future that reveals what
many describe as one of the last great investment frontiers. Many reports look at
forward GDP, forecast currencies etc. We
all know that there are enough analysts
parading around Africa collectively being
paid the GDP of a small African country
to dissect African economies. But this is
to miss the tremendous opportunity that
well-managed private sector businesses
are able to capitalize on going forward.
Instead of looking at the usual
numbers to determine Africas investment potential; let us look at some of the

strong demographic characteristics. Using
East Africa as a microcosm for Africa, it
becomes apparent that the sheer growth
in population will force heavy investment
in agriculture, infrastructure, communications, health care, education etc. With
this investment in these industries will
come development of the capital markets.
Countries with well developed pension
sectors will be at a distinct advantage to
others without reform. Pension funds are
a national source of capital. They are dependable and long-term (unlike foreign
capital flows). In East Africa one cannot
underestimate the tremendous contribution to economic growth the privatesector pension fund industry has made to
Kenyas capital market development. Juxtaposed with Uganda and the absence of
pension reform is readily apparent there
is no large pool of domestic long-term
capital outside the NSSF which poses
a strategic weakness to the Ugandan
economy and an overreliance on foreign
goodwill.
So lets look at the numbers. The
population of East Africa (about 130 million people) is set to double by 2045. That
is less than a generation away. There are
two ways of looking at this. The proverbial glass is half-full or half-empty. Halfempty if you consider that a lack of investment in the countrys infrastructure,
food supply chains, education and health
care will almost certainly lead to more resource-based power struggles, or half-full
if you consider the number of investment
opportunities that will most certainly
arise from this growth. I prefer the halffull approach.
Kenyas median age the age at
which 50% of the population is below is
18.6 years. Half the population of Kenya
is still in high school or below. That half
of the population are going to need a cell
phone, a bank account, tools of a trade, a
tertiary education.you get the picture.
Well managed business with forward

looking management teams that can position a business successfully today will ride
a wave of growth and economic activity.
The ball is in the Governments court to
provide an enabling environment. They
should not try manage investments or
businesses outside the crucial services
such as paying the judiciary, police etc.
This also means that there must be a serious effort on the part of society to stop
corruption. I say society to include Government and the broader community because corruption is far too entrenched as
a normal course of business and it is hurting Africas economic growth.
There have been great strides on
the political front. Indeed a change of the
old guard is underway this is necessary
for any society. By the time you read this
Barack Obama will probably signify how
apparent the need for change and fresh
blood is in any leadership process. Politics
in Africa will continue in this encouraging vein taking a key uncertain variable out of the investment equation when
considering African investments. Let us
guard against being arrogant as Africans
that we dont need international investment. We do, but we can take it on our
terms.
The key investment we must make
in Africa is an investment in our people.
Theres no shortage of money and opportunities. There is a shortage of skilled
managers to convert this money and opportunity into value creation. Lets us
focus on the huge potential well of depth
we have Africas future as an investment
destination depends on her people. Both
as consumers and as entrepreneurs serving
those consumers. It is incumbent on this
generation to ensure that a dollar invested
in Africa today will yield a higher return
than a dollar invested anywhere else over
the next ten years. Any other result and
we are not taking advantage of the awesome opportunity Africa is affording us
today.
17
Chirs M, Chartered Financial Analyst
Global Financial Crisis

and African Stock Exchanges
he Current Global financial

crisis is said to have been
triggered by the US Sub
prime mortgage crisis. This
is where loans were made to
market segments that would
normally have been avoided by lenders
during more sane times. Apparently the
motivation for profit over came any sense
of prudence and moderation. The result
was a major fall out and mass defaults
along with ripple effects. This seems to
have triggered defaults on aggregated
loans instruments also called collateralized mortgage securities in the US. Defaults and the likely hood of more defaults
seemed to signal a change in fortunes of
the US economy. Financial institutions
that had been trading in derivatives using
a lot of leverage faced difficult situation as
lenders risk appetite dwindled. It became
hard for companies to raise funds as lenders did not want to lend entities that may
fail to repay back on time, or at all.
tion of some economies, export earnings

are likely to grow. In a way remittances
are a result of export of human capital,
and it seems to be an important source
of steady inflows, impacting the African
economies more than other sources of
revenues.
Remittances from the Diaspora
have been estimated at one time by the
World Bank to be about US$ 318 Billion
Africa likely to be less affected by the

global melt-down.
The main sources of inflows to Africa

have been: Remittances, Aid, Exports
earnings, and Foreign Direct Investment.
These inflows have created jobs, increased
incomes and disposable income. One of
the factors affecting the stock markets in
most of Africa is low savings rate, which
is a direct result of low incomes and a
high propensity to consume. Factors affecting income levels will affect savings
whether directly on stocks or via collective investments like unit trusts.
Aid has been attributed to being
provided with strings attached. FDI also
seem to have a mixed set of results since
it is structured to primarily meet the investors interests. Export earnings have
lagged behind other areas. Recently with
growth of regional trade and diversifica18
per year globally. Africa was officially said

to account for about 8% of that US$
27 Billion. This money has been used for
consumption, health care, education, investment in real estate, and stock markets
securities. By some accounts it is a better
catalyst for development than foreign aid.
Aid has been notoriously inefficient for a
number of reasons:
Institutional structures with the various administrative layers ensure high
overheads.
The Current Global

financial crisis is said
to have been triggered
by the US Sub prime
mortgage crisis, creating
a domino effect, which
has wiped out billions
of dollars from global
economy
There seems to be wide

spread consensus that
a down turn in America
and Europe would lead to
slower donor inflows for
Africa. There also seems
to be an agreement
that trade with those
economic blocks could
suffer as consumption
patterns change.
Large dependence on procurement from the

donor country puts to question whether the
aid is meant for catalysing development in
the recipient country or it is meant to create jobs for citizens of the donor country. In
many cases these two goals have been demonstrated to be mutually exclusive and not
necessarily congruent.
In an institutionalized donor environment,
resource allocation is done according to the
advice of experts who may not be up to date
with realities of the market place. Remittances are however utilized according to priorities set by the beneficiary, not the donor.
There seems to be wide spread consensus that a down turn in America and Europe
would lead to slower donor inflows for Africa. There also seems to be an agreement that
trade with those economic blocks could suffer
as consumption patterns change. There are expectations that direct investment from those
regions could also reduce. Corporations would
be expected to be downsizing or at least moderating their expansion plans. On the other
hand, given Africas growth potential, it can
be expected to continue to attract capital investments.
Obviously we should not expect a lot of
hot money looking for short term investment
returns. This kind of speculative investor is
likely to be more risk averse due to events back
at home. Strong investors with a long term
view on Africa will continue streaming in,
because they understand that Africa is largely
still on the growth trajectory.
Africas stock exchanges had a bull run
over the last few years. The drivers of that Bull
Run could be summarized as follows:
Risk seeking behaviour as investors sought
diversification and return enhancement.
Growing attention given to African markets, being the last frontiers after Asia and
Latin America
Increasing liquidity as more participants
come set up shop in emerging markets,
emergence of investors who pride themselves in understanding less sophisticated
markets, as well as being able to strike the
delicate balance between increasing risk appetite and return enhancement. A host of
hedge funds come to mind. Emergence of
groups like the direct expatriate nationals
investment www.deniafrica.com.
What is likely to happen is that Africa will

once again start to get into the drivers seat of
its Economic affairs.
It is likely that African Financial professionals will realize that its time to get into
the drivers seat. Waiting for the west to
first solve its problems and then remember
Africa will take too long. Besides Africans
understand their needs better than any one
else. They are best placed to provide solutions.
Privatization models that encourage retail
investors to participate are likely to continue and possibly gain momentum. Africans
in the Diaspora are more likely to participate in purchasing securities. These could
be a means of saving but also can provide a
soft landing, just like real estate, when the
time to return home comes.
Slower progress in raising capital from international sources. Many countries have
expressed intent to issue sovereign bonds
on international markets, ostensibly to raise
money for infrastructure projects among
others. These bonds would be foreign currency denominated. The significant currency exchange rate exposure is one of
the factors that would translate into lower
credit rating. Issuing these bonds denominated in domestic currency removes the
exchange rate risk exposure from the issuer Government. Potential buyers of such
a bond would like it to be denominated in
their domestic currency if they are international in nature. If an African government
floated infrastructure bonds domestically,
at this time it would still succeed. This can
be seen from the high interest in treasury
securities, which involve only domestically
denominated issues.
Regional trade will increase as economies
seek diversification opportunities. Also trade
with new partners like China will increase.
Those countries that have a food surplus are
in a position to export to regional neighbours in need of food imports.
Portfolio investors and foreign direct investors (FDI) are more likely to invest in
Africa if Africans themselves are investing
in their own economies. So, Africans both
at home and abroad will lead the way and
show that we have full confidence in our
economies. This way jobs and wealth will
be created, eradicating poverty.
19
Leo Kibirango President of the Uganda Institute of Corporate Governance
Corporate Governance
he recent spate of criminalizing of corporate directors board performance has thrown their
hitherto
infallibility
doctrine into tatters and,
under the weight of gross
mismanagement, shattered the myth of
their incisive oversight over corporate enterprises. Enron, Goldenberg and recently the stinging losses by Society Generale
have shown how inadequately regulated
corporate power can be abused virtually limitlessly. Directors who for decades
wielded absolute power, accounting only
to annual general meetings and indeed,
Just like a professional

speech writer takes days in
research and preparations
for a good speech, careful
preparation ensures a
successful board meeting. All
aspects including location,
board papers and other
administrative arrangements
must be considered.
20
occasionally based on engineered records

have now to face the possibility of banishment from their coveted positions, severe
curtailment of their powers and exposure
of personal assets to risk.
Directors cynicism on corporate democracy is rapidly being replaced
by pro-activism while business acumen
substitutes for hitherto firmly embedded
red-tapism. Being a director is no longer
an income generating activity granting access to unlimited perks but has as-
sumed significant liability that could lead

to bankruptcies let alone imprisonment.
Accepting to be a director must therefore
be considered seriously from all angles including the integrity of the team of fellow
directors, the nobility of the objectives of
the corporation and the sustainability of
the enterprise. The boardroom offers an
interesting arena for playing the corporate
game of enterprise management, abuse
and / or wreck.
Just like a professional speechwriter takes days in research and preparations
for a good speech, careful preparation ensures a successful board meeting. All aspects including location, board papers and
other administrative arrangements must
be considered. Unscrupulous managers
sometimes manipulate the location of the
board meeting to some obscure traffic infested area just to keep away undesirable
directors especially at the crucial stage of
board resolutions, which might intimately
affect staff. Information asymmetry to
directors where a few, particularly the
executive directors have access to more
current information than others invariably disadvantages inquisitive directors
and may lead to contestable resolutions
rapidly passing through hashed up meetings. Directors should be on their alert
for management reports which cover only
the familiar or preferred solutions and
which purposefully detract from discussing all available options. Similarly board
documents may sometimes be posted to
directors only to be received long after the
meeting, thus effectively disenfranchising
such directors and rendering them fishes
out of water during the on-going deliberations.
It is pertinent to ask whether the
board should waste time preparing an
agenda to make it acceptable to board
members. The collective responsibility
doctrine goes beyond merely obtaining
consensus at board meetings but embraces contributions to the preparation of the
agenda partly to avoid time wasting during the haggling game for approving the
agenda and partly to ensure inclusion of
all critical issues.
Agreed procedures for conducting
board meetings seek to limit disruptive
movements for attending to guests, telephones and conducting side meetings.
The pre-agreed commencement time must
be respected and late coming should be
sanctioned either directly, by the chairperson or through annual reports to the
AGM. Disruptive directors tend to drag
meetings and should be disciplined under
a pre-agreed code of conduct, which every
director should sign upon appointment.
The board is allowed to delegate to
ensure access to expert advice and to expedite recommendations. Well-organized
teamwork concretizes convergence on
topical issues; enhance cohesiveness and
professionalism by tapping special skills
within and without the board. Directors tend to get a better feel of technical
issues when management forms a strong
component of various committees, hence
expediting recommendations to the full
board while management is given the
opportunity to articulate dynamic staff
issues. However, without clear and relevant terms of reference, the effectiveness
of committees is thrown into the confusion of duplication, overlap and intrigue
especially concerning destination of issues that fall in gray areas. Powers given
to committees should facilitate dynamic
decision-making process embracing discussion and final execution, consideration
and execution pending board endorsement or deliberation and recommendation
to the full board.
The intricacies of board meetings
feature more prominently during the
meeting itself. The chairpersons remarks
(not formal statements) help to focus discussions on key agenda issues providing
relevant background where needed. Any
diversionary issues introduced at this
stage tend to steer the ship away from

the agreed agenda into rough and invariably more turbulent waters of unknown
territory and should be resisted. Following right on the heels of the chairpersons guidance must be the clearance of
the minutes whose accuracy forms one of
the cardinal pillars to the integrity of the
corporate records. The most interesting,
let alone dreaded period is the discussion
of sensitive issues which might precipitate into name calling, exhibit sectarian
tendencies, emergency of domineering or
strong man-tactics on one hand and well
intentioned incompetence where dump
but honest directors fall prey to the
machinations of shrewd but vicious fellow
members. This poses one of the biggest
challenges to the chairperson who has to
calm the troubled waters by firmly but orderly imposing a level playing field.
Dead locks are part of the dynamics of board meetings and may indicate
different appreciation of issues, technical
complexities or inadequate preparations.
These can be resolved by health breaks
to facilitate consultations and deeper reflection on the issues, receiving expert
advice or reference to a specialized committee.
A lively meeting should end with
shaking of hands where nobody is a looser
but where the corporate entity is the winner. The chairperson should tied up the
loose ends on each issue and delve into
discussion of any other business without
however permitting tabling of new issues except as an input into the following
meetings agenda.
Dead locks are part of the

dynamics of board meetings
and may indicate different
appreciation of issues, technical
complexities or inadequate
preparations. These can be
resolved by health breaks
to facilitate consultations
and deeper reflection on the
issues, receiving expert advice
or reference to a specialized
committee.
The writer is the President of the Uganda Institute of Corporate Governance and a Governor, emeritus Bank of Uganda
21
Sylvia Juuko Business Journalist
Impact of Ugandas Securities Exchange

Thousands of Ugandans have discovered, through the Uganda Securities Exchange, a channel to invest
their earnings in assets outside the traditional cash and land. In addition the USE has been responsible
for giving Ugandans an opportunity to benefit from profitable state enterprises. The results have been
dividends and capital gains for thousands of individuals. These are just some of the many benefits that
have come with the creation of a stock exchange in Uganda
Over Ushs.103billion
has been raised from
equities, Ushs.90billion
from corporate bonds
and Ushs.1.7trillion from
government bonds.
22
HE history of the 10-year old

(USE) would arguably be incomplete if the impact of Stanbic banks listing on the bourses
activity is not emphasized.
Stanbic banks Initial Public offer (IPO) and eventual listing in 2007
propelled the bourse to a level of vibrancy
never before recorded in the institutions
history.
But more significant however is the
story of the first equity - Uganda Clays Ltd
(UCL) which listed in the year 2000 at
Ushs.4,000 per share.
UCL, a leading manufacturer of construction products has seen its market capitalization grow to the current Ushs.121.50b
from Ushs.2b at the time of listing.
The company has acquired the disciplined that comes with listing in terms of
strengthening management, strategic planning,
and financial management among others.
The benefits of listing are clear.
UCL has grown from an SME and has
been able to progress, invest, successful
carry out a rights issue to raise money and
expand its footprint not only locally but
beyond boarders, says Mr. Simon Rutega
CEO at the USE.
The growth of UCL mirrors the
wider growth of the USE that has seen an
increase in the number of listings currently
at 9, with 6 corporate bonds and 30 government bonds. There has been a surge in market capitalization, shareholder growth and
activity turnover.
From the maiden instrument that
was the East African Development Bank
(EADB) bond, other products were subsequently listed including British American Tobacco (BATU), Bank of Baroda
(BOBU), Dfcu bank, New Vision (NVL)
and Stanbic bank (SBU). The stock market
also benefited from cross-listing from the
Nairobi stock exchange that includes Kenya
Airways (KA), Jubilee Insurance and East
African Breweries Ltd (EABL).
USEs market capitalization has also
expanded from Ushs.2.3b at the time of
listing of UCL to the current Ushs.4,460b.
The significance of the stock market
as an efficient avenue to raise money away
from the traditional sources of financing
like commercial banks has been highlighted by the Ushs.2.5 trillion raised over the
last decade.
Mr. Rutega says that over
Ushs.103billion has been raised from equities, Ushs.90billion from corporate bonds
and Ushs.1.7trillion from government
bonds.
The market has also witnessed unprecedented interest from local shareholders who have registered good dividend
payments and capital gains on their investments during the bull-run at the stock market. The oversubscription for most of the
issues and bonds points to the availability
of capital than can be mobilized and channelled to fund not only business but also
infrastructure.
Away from the traditional asset

classes of cash and land, investors have
discovered that money can be made at the
stock market. Currently the bourse has
between 50,000-60,000 retail investors.
More importantly also, the fact
that both Uganda Clays and New Vision
rights issues were oversubscribed points
to availability of untapped resources. This
coming against a background of Safaricom let down highlights the fact that our
market has come of age. Billions of shillings can be successfully mobilized if the
right channels are availed.
However, foreign participation especially retail investors from neighbouring Kenya has been strong comparatively
due to wider knowledge about capital
markets and the comparatively cheaper
costs of Ugandan stocks.
We have no restrictions for both
local and foreign investors. We have been
able to attract a lot of foreign investors,
says Mr. Rutega.
He recognizes the impact USE has
had on the lowering of interest rates in
the market.
Initially we had instruments that
were short term and there was pressure on
the interest rates. We saw the impact from
2004 where short term rates started coming down from over 20% for the Treasury
Bills. Since then, the average has been
around 10-14% so clearly there has been
an impact, Rutega notes.
The partnership between privatization and USE is evident with the equities
that had to be listed as part of the process
of providing platform for wider participa-
tion of individuals in enterprises where

government had a stake. On the other
hand, the bourse has enhanced publics
perception of privatization.
Mr. Rutega hopes more companies
will consider listing at the USE in the
near future.
Private entities should have seen
the benefits of listing and are prepared to
come to the stock market to benefit from
a comparatively cheaper sourcing of financing, he said.
Listings expected in the near future include National Insurance Corporation (NIC), Kenya Commercial bank
(KCB) and Equity bank cross-listings.
The National Water and Sewerage Corporation and Stanbic bank have also announced plans to issues corporate bonds.
Despite the milestones that have
seen the USE become part of the financial system, the market is being weighed
down by challenges.
We have had frustration regarding the passage of the CDS bill. We hope
it will be passed next month. The platform is already installed and test runs
have been completed, he says.
The CDS will make the immobilisation of share certificates into electronic
accounts possible. Electronic book entry
payment movement of shares, pledging of
shares as collateral and statement of share
accounts will be possible which will eliminate settlement bottlenecks at the USE
making electronic trading a reality.
Reflecting the small size of the
economy, the number of listings has been
sluggish resulting in low tradable instru-
Away from the traditional asset classes of cash and land, investors
have discovered that money can be made at the stock market.
Currently the bourse has between 50,000-60,000 retail investors.
Subscriptions at IPOs
Individuals
Corporates
UCL
BATU
BOBU
DFCU
NVL
SBU
1,004
1,548
1,948
3,728
2,077
35,068
28
60
47
102
33
1,870
106
228
519
1,032
1,608
1,995
3,936
2,338
37,457
14%
5%
17%
1%
30%
200%
ESOP/Staff
TOTAL
Oversubscription levels
Securities Central Depository

Ownership of shares in a listed
company is evidenced by a
certificate of ownership. Therefore,
USE, as the market, plays a role
in facilitating transfer of share
certificates between investors
through its trading, delivery and
settlement rules. In this respect,
USE in conjunction with the listed
companies and their registrars, is
obliged to provide a conducive,
efficient and risk free shares
transfer process. In order to fulfill
this mandate effectively and
efficiently, USE seeks to implement
a Securities Central Depository
(SCD) system for Uganda.
This is a system in which
stocks belonging to a particular
entity are deposited in the
custody of a central depository
such that transactions or transfers
concerning such stocks are
executed in book entry form. It
acts like a bank of shares, and
hence holds shares of investors
(shareholders) in a central and
integrated manner.
By depositing share
certificates into a central
depository, the delivery of shares
in settlement of a transfer of
shares executed between a seller
and a buyer can easily be achieved
with change of records in the
central depository instead of
physical exchange of certificates.
Once an investor opens
a securities account, the SCD
will accept deposit of securities
certificates through the
participants (brokers/dealers)
and register their shares in the
system. Settlement will be done
on behalf of the investor by the
participants.
The SCD computer system
is designed and built on the
latest technologies with a robust
architecture to ensure high
reliability while addressing backup
and recovery issues adequately.
The Capital Markets
Authority will oversee and
regulate the SCD operations.
Source: USE Research Dept.
23
Another hurdle that the USE

has to jump is attracting
private companies to
list shares on the stock
exchange. Most of the
equities listed have been
government divestures.
ments at the stock market which has affected liquidity at the bourse.
The bourse is currently experiencing
a bear run after period that saw share pricing at an all time high, due to the aftermath
arising from the global financial market
turmoil as investors take positions regarding
their investments in emerging markets.
The fundamentals are still strong but
Training The Bourse Quest

The Ugandan market is characterized by a skeptical
society that predominantly prefers the traditional,
more physical forms of investment; and a low level of
awareness and appreciation for capital markets. The
result is the low volumes, small investor base, and lack
of liquidity (Liquidity refers to the ease with which
investments can be converted to cash at their present
market value) that have become characteristic of our
markets making lack of awareness the most significant
impediment to growth.
In order to empower the masses through public
awareness and education on capital markets and
imparting knowledge about savings and investment in
financial instruments, the USE has installed a system
that will help the public acquire information on Capital
markets electronically. This system which is called
the Bourse Quest is an education tool developed to
help the public in its search for information on capital
markets and creates a comprehensive knowledge base
for investors, students and professionals who want to
learn about all the aspects of the stock exchange and its
related activities. It compliments the existing system of
providing raw educational materials to the public.
24
we have jitters and prices do come down. As

far as we are concerned its a bear market,
he explains.
Rutega advises that to minimize impact of fall in share prices, retail investors
should participate via collective investment
schemes.
Investors must understand that
markets gain and lose. What is important
is transparency. Markets will always correct
themselves; its about supply and demand.
. Another hurdle that the USE has to
jump is attracting private companies to list
shares on the stock exchange. Most of the
equities listed have been government divestures through availing their share holding to
the public via the stock market.
Despite the potential and the discipline that comes with listing among other
things, the Ugandan market is yet to see a
private company list.
Mr. Rutega is bullish that despite the
current global financial market turmoil, the
exiting of foreign investors would be born
by the stock market.
He stressed that the market would
be impacted of the companies listed on the
bourse were hit by the global economic slowdown or if the general economy took a hit due
to recession in the US and the Euro zone.
Regional SITI training institute

SITI East Africa is a securities training Institute that
was commissioned by the East African Securities
Exchanges Association (EASEA) to manage and deliver a
wide range of training programs on Capital Markets and
Investments; Corporate finance; Pension; Insurance;
Business Management; Entrepreneurship; Corporate
Governance; and related fields of study.
The establishment of SITI East Africa was inspired
by a dire need for players in the Region to benefit
from a systematic and well managed training and
capacity building initiative. As markets in the region
continued to post fast growth; players were faced with
a challenge of enhancing their skill-sets in order to keep
up. EASEA spotted this challenge and, together with
its development partners, developed SITI to deliver
pertinent training and capacity building across the
Region. Today SITI operates in four East African Markets
of Kenya, Tanzania, Uganda and Rwanda. The main
headquarters for SITI are at the USE Offices on 2nd Floor
Workers House, Kampala.
Stock Brokerage firms
26
MBEA Brokerage Services (Uganda) Limited

MBEA Brokerage Services (Uganda)
Limited (MBEA) is an investment house
headquartered in Kampala, Uganda and
incorporated in February 1997. The Firm
is a Licensed Dealing Member (LDM)
and founding member of the Uganda Securities Exchange (USE) and was issued
with a Broker/Dealer license and Investment Advisors license by Ugandas Capital
Markets Authority (CMA) in May 1997.
MBEA is backed by experienced
personnel supported by Technical Partners who give operational, technical and
professional support, namely:
Databank Financial Services Limited
(Ghana) the premier investment banking firm in Ghana and West Africa.
Auerbach Grayson & Company Incorporated, USA (AGCO) is a U.S.
stockbroker with a worldwide network of
broker partners in 98 countries in Africa,
Middle East, Asia & Pacific, Europe,
South America and North America.
The combined team brings a significant amount of experience and expertise in
financial advisory, primary and secondary
securities issues, securities sales and trading,
and investment/fund management. MBEA,
its technical partners and international strategic alliances have extensive experience in
the African and international capital markets and access to a wide portfolio of local
and foreign investors.
MBEA is governed by a 5-member
Board of Directors comprising the following:
1. Malcolmn Dermott Pryor*
Chairman
2. Andrew A. N. Otengo Owiny
Managing Director
3. Kenneth G. Bruce Jr.*
Non-executive Director
4. Faustin Mbundu
Non-executive Director
5. Hamu Mugenyi
Non-executive Director and Company
Secretary
(* American)
The day-to-day operations of
MBEA Brokerage Services are handled
by a Management team of five (5):
1. Andrew A. N. Otengo Owiny
Managing Director / Chief Executive.

2. Inga Rubadiri-Nyangabyaki (Mrs.)
Head of Operations.
3. Davis L. Gathaara
Head of Sales & Trading.
4. Anita Matovu Owiny (Mrs.)
Head of Research & Information.
5. Farouk Joshua Tezikuba
Head of Finance & Administration;
SERVICES OFFERED
Brokerage services;
Advisory / corporate finance services;
Financial services intermediation;
Investment advisory and management services
MBEA has handled a number of
corporate finance transactions, equity
and bond/note issues/listings in a lead
or co-lead advisory/arranger, co-advisor/
arranger and/or lead sponsoring broker
role. The following is a summary of the
transactions handled by MBEA over its
10 year history:
Bond / Note issues Listed on the USE

and Privately Placed include
1.
2.
3.
4.
5.
6.
7.
National Water and Sewerage Corporation Ushs 100 Billion medium

term note programme (2008).
Housing Finance Bank Limited
Ushs 30 Billion note issuance programme (2006-7).
Banque Commerciale du Rwanda
S.A. RwF 5 Billion note issuance
programme (2006-7).
Standard Chartered Bank Uganda
Limited Ushs 23 billion Subordinated Debt Bond Issue (2005-6).
East African Development Bank
Ushs 20 billion Floating Rate Note
Issue (2005).
MTN Uganda Limited Ushs 12.50
Billion note issuance programme
(2000-2).
Uganda Telecom Limited Ushs 54
Billion Medium Term Note programme (2003-4).
8.
East African Development Bank Ushs

10 Billion Bond Issue (1997-8).
Equity Issues & Listings on the USE

9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
National Insurance Corporation

Limited IPO (2006 to date)
Uganda Telecom Limited restructuring and IPO (2006 to date).
Kinyara Sugar Works Limited IPO
(2002 to date).
Stanbic Bank (U) Limited IPO
(2006).
DFCU Limited bonus shares listing
on the USE (2005).
New Vision Printing and Publishing
Company Limited IPO (2004).
DFCU Limited IPO (2003-4).
Bank of Baroda (U) Limited IPO
(2002).
British American Tobacco Uganda
Limited IPO (2000).
Uganda Clays Limited IPO (19992000).
Cross listings on the USE
19. East African Breweries Limited issue and listing of bonus shares on
the USE (2007).
20. Jubilee Holdings Limited cross listing on the USE (2006).
21. East African Breweries Limited issue and listing of additional ESOP
shares on the USE (2004).
22. East African Breweries Limited issue and listing of bonus shares on
the USE (2004).
23. Kenya Airways Limited cross listing
on the USE (2001-2).
24. East African Breweries Limited
cross listing on the USE (2000-1).
Other Corporate Finance Transactions
25. Dairy Corporation Limited divestiture of the Government of Ugandas

100% shareholding, through sale to
a strategic investor (2002).
26. Private Sector Foundation of Uganda
mandate to represent the Foundation
during the World Bank mid-term review of the Foundations effort to establish an equity fund in Uganda (1999).
27
African Alliance Securities

African Alliance Securities is the
stockbroking division of the African Alliance Group. We provide local and onthe-ground stockbroking and research
services across the African continent.
Our highly experienced and professional sales and trading teams complement our analytical resources. Providing a full agency broking service to fund
managers at insurance companies, pension funds, investment trusts and unit
trusts, we aim to help our clients achieve
their performance goals.
An efficient and competitive
transaction capability is at the heart of
our stockbroking operation. Our energetic, experienced and client centric
dealing team is committed to executing
business on the most competitive terms,
drawing on strong trading relationships
with leading investment houses, stockbrokers and market-makers.
Independence, flexibility, creativity and entrepreneurial thinking are key
ingredients in our formula for building
partnerships that work. Thriving under
pressure and driven by challenge, African Alliance Securities sees itself not
only as providers of a wide range of financial services, but as custodians of true
customer relationships.
Our clients include governments,
parastatals, institutional fund managers,
corporates and high-net worth and retail
investors.
With a powerful combination

of strength and agility, we help clients
fulfill their financial objectives by transforming ideas into reality as part of a
highly individual service.
Philosophy
At African Alliance Securities we understand that who you invest with is often
more important than what you invest in.
Our processes and procedures, the
experience that we have gained and our
on-the-ground teams, provide us with
the ability to effectively manage the risks
inherent in financial transactions.
In this new century, it is those who best

manage change who will survive and
prosper. Success belongs to those who
identify and capitalise on the opportunities surrounding them. It is in this shifting environment that African Alliance
Securities operates.
We have a unique philosophy that
is aimed at providing our clients with the
most suitable skills and services within
a local context. Our staff comprises onthe-ground professionals, experienced in
country-specific, African and international markets.
30
Client Relationships
We seek to develop long-term client relationships based on trust, delivery and

service excellence.
We believe in listening to our clients, as an understanding of our clients
specific needs is integral to the successful delivery of work-class stockbroking
services.
Our clients choose to use the
services of African Alliance Securities
because:
SERVICES OFFERED
Execution and Advisory Services
Listing and related work
Discretionary portfolio services
Research
Pan-African dealing desk
we are part of their national business
culture
we have a physical presence
we employ resident staff with local
knowledge and experience
we focus on delivery and service
Our clients define who we are.
Risk Mitigation
Staff
Our staff are of the highest calibre and

their levels of professionalism and dedication to delivery are absolute. We believe in combining experience and expertise with local knowledge.
All regional staff are employed

in their countries of origin but may also
be utilised in other regions, as required.
This gives our staff greater exposure to
other markets and they are consequently better equipped to fulfil our clients
evolving needs.
Development
Our involvement in the countries that

we operate in is long term in nature and
we are committed to the sustained development of those economies. We seek
to assist in the deepening and advancement of the capital markets. We, where
necessary, challenge the legislative environment so as to promote greater investor opportunities and protection.
We occupy actual, rather than
virtual offices and employ and train resident staff. Our policies of staff development and training uplift the skills levels
in the countries in which we operate. We
develop, implement and invest in systems aimed at conducting business ore
effectively and professionally.
We seek to enhance value through
our involvement in any transaction.
Delivery
Thriving under pressure and driven by

challenge, we see ourselves not merely
as providers of a wide range of financial
services but as custodians of true client
relationships.
We favour an honest, open approach to doing business and we choose
to serve clients that leverage the value of
our people and resources to the best advantage of all stakeholders. We respect
the integrity and confidentiality of each
of our clients. We relish opportunities
that test us and that harness our pooled
skills and energies.
African Alliance Securities operates under a strict code of Corporate
Governance.
We have built our business and
our reputation on meaningful and mutually beneficial relationships with people
who share our vision of success.
Companies Listed on USE
55 years of making millions smile
55
Baroda Capital Markets (U) Ltd

(fully owned subsudiary of Bank of Baroda (U) Ltd.)
32
Bank of Baroda Uganda

2500
12000
8000
2000
Volume
Price
1500
6000
1000
4000
Volume in 000
Share Price
10000
Bank of Baroda Uganda
500
2000
Market
Uganda Securities Exchange (USE)
Listing Date
14 November 2002
Market value
600*
Shares issued
400,000,000
Market Cap
444,000,000,000*
Trading status
Normal
* on 30th September 2008
Ap
r
Ju 20
l 0
Oc 20 3
t 0
Ja 20 3
n 0
Ap 20 3
r 0
Ju 20 4
l 0
Oc 20 4
t 0
Ja 20 4
n 0
Ap 20 4
r 0
Ju 20 5
l 0
Oc 20 5
t 0
Ja 20 5
n 0
Ap 20 5
r 0
Ju 20 6
l 0
Oc 20 6
t 0
Ja 20 6
n 0
Ap 20 6
r 0
Ju 20 7
l 0
Oc 20 7
t 0
Ja 20 7
n 0
Ap 20 7
r 0
Ju 20 8
Se l 2 08
pt 00
20 8
08
Bank of Baroda is a leading

International bank having its
presence in 25 countries across
the globe and with special focus in entire Africa. Uganda
was the second destination after Kenya where Bank of Baroda started its overseas operations. Bank of Baroda opened
its first office at Kampala on
18.12.1953. Bank has passed a
milestone in its history by celebrating 54 years of uninterrupted service to the people of
Uganda.
Baroda enjoys a high
corporate image in the country. It stands for transparency
and the safety of public money in the country. Although
many banks have failed over
the years due to various reasons, Bank of Baroda remained financially sound and
stable, committed to providing dedicated and uninterrupted services to the nation.
Even on the momentous occasion of Golden Jubilee in the
year 2002, His Excellency the
President of the Republic of
Uganda, made commendable
remarks in his congratulatory
message for the bank.
Bank of Baroda became
the first financial institution in Uganda listed on the

(USE). Bank has been paying
K. K. Shukla
Managing Director
dividends to the shareholders

consistently at 60% since 2003
that rose to 70% in 2006.
Shareholders of the bank approved a split of the companys
shares in a ratio of ten shares
for every one share held. Consequently the nominal value
of each ordinary share of
Ushs.100/- each is converted
into Ushs.10/- each. Thus the
number of shares authorized
become 400,000,000 ordinary
shares of Ushs.10/- each.
Trading in the split
shares at the Uganda Securities Exchange commenced on
the 09th September 2008 and

the present market price of the
shares is Ushs.1040/Bank has been significantly contributing to the
Ex-Chequer. It ranked 75th
among the countrys top 100
taxpayers to Uganda Revenue
Authority (URA). As a good
corporate citizen, Baroda has
always been in the forefront on
the social welfare, educational
and sports activities.
Bank of Baroda is one
of the 5 leading international
banks in the country presently
operating through its 7 (seven)
branches viz. three in Kampala town at Railway Station, 18,
Kampala Road & Kansanga
and four in upcountry centres
at Mbale, Mbarara, Iganga
and Jinja and ready to open
08th branch at Kawempe,
Kampala.
Bank has been offering
a variety of innovative products to suit its clientele base.
Some of the products offered
by the Bank are viz: Baroda
Super Savings Bank Account,
Baroda Flexi Recurring Deposit Account, Baroda Salary
Loan, Baroda Multipurpose
Loan, Baroda IPO Loan etc.
Bank has been

significantly contributing
to the Ex-Chequer. It
ranked 75th among
the countrys top 100
taxpayers to Uganda
Revenue Authority (URA).
As a good corporate
citizen, Baroda has always
been in the forefront
on the social welfare,
educational and sports
activities.
Bank has been significantly contributing in developing the countrys economy.
Its capital base touched Ushs.
54bn, lending portfolio is at
Ushs.101bn and deposit has
crossed Ushs. 190bn. as on
30.09.2008. Profit of the bank
has also been increased year
after year and profit as on
30.09.2008 is Ushs. 11.02bn.
Bank has competent, experienced management team
and highly experienced and
professional staff. The Bank
has drawn an ambitious plan
to expand its operations in
Uganda to seize the growing
opportunity.
33
34
Development Finance Company of Uganda Ltd

15000
1000
Development Finance Company of Uganda Ltd
Share Price
800
Volume
Price
9000
600
6000
400
Volume in 000
12000
3000
Market
Listing Date
14 October 2004
Market Value
775*
Shares issued
248,600,911
Market Cap
195,200,200,000*
Trading status
Normal
DFCU Limited was established in 1964 as a development finance institution. Over

the years DFCU has been associated with many success
stories in Ugandas economy
in various sectors transport,
education, floricultural, agricultural, manufacturing and
agro-processing.
In 2000, the company
bought Gold Trust Bank and
started commercial banking
and renamed it DFCU Bank.
Privatisation
In 2003, DEG sold its 24.7%

equity interest in DFCU Ltd
to CDC and in the same year,
DFCU Ltd also sold its 50%
Product and Services offered
Savings and Investment
Accounts
Personal and Corporate
Current accounts
Personal / Corporate /
Business Credit
Trade Finance
Specialized products
for Small and Medium
Enterprises (SMEs)
Foreign Exchange trading
Money Market placements
Money Transfers including
MoneyGram
08
20
08
pt
20
n
Ja
Se
07
20
n
Ja
06
20
n
Ja
05
20
n
Ja
Oc
t2
00
200
stake in HFCU to the National Social Security Fund.

In 2004, the Government of Uganda decided to
sell its shares in DFCU Ltd.
This made DFCU Ltd the
second financial institution to
list on the USE. The Government of Uganda sold its shares
to the public through an offer
of 79,509,743 shares representing a 39.97% stake in the
company at a value of Ushs
45,742,567,670 at offer price.
The IPO price was Ushs 230
Ownership
DFCU Limited is listed on

the Uganda Stock Exchange
since 2004. The shareholders
are the CDC Group plc (Actis
60%), Norfund (10.1%), Investec (8.2%), National Social
Security Fund (5.93%), and
other shareholders (15.77%).
These other shareholders are
everyday Ugandans who initially bought shares in 2004.
Today DFCU shares
are traded regularly on the
USE and have proved to be a
good investment.
Finances
The financial results for the

period ended June 30, 2008
of the new set up showed that
the company posted revenue of

Ushs 24.36 billion and Profit
after Tax of Ushs 6.14 billion, representing an increase
of 50% and 60% respectively
over the same period in 2007.
Customer deposits also grew
by 45% to Ushs199 billion and
total assets by 10% to Ushs
423.66 billion as compared
to the June 2007 results, with
growth in quality lending being a key focus for the second
half of 2008.
Our values

Customer Focus
Team Work
Integrity
Excellence
Sustainability & Social Responsibility
Socially responsibility
Over the years DFCU has endeavoured to make a positive

impact in the communities in
which it operates. Our most
notable activities include public
health activities in Kawempe,
Makindye and Nakawa Divisions. In Arua and Lira, we
have made donations to improve the lives of new-born
children. In Pader and Kitgum,
our contribution of ox-ploughs
and bee-hives is meant to im-
prove the economic well-being

of hundreds of Ugandans.
In 2007, Bank of Uganda
nominated DFCU Bank as
the best Primary Dealer of
the year. This means that
DFCU Bank performed
best overall in auctions
of monetary policy
instruments (treasury
bills, treasury bonds
etc), trading of Uganda
Government Securities
and the transmittal of
information regarding the
status of the financial
markets to the Central
Bank.
Future Prospects
DFCUs immediate priority in 2008 is to consolidate

their operations and expand
their footprint in Uganda and
to deepen the presence within
the domestic retail and SME
segments. They will have 20
branches by December 2008.
They will also explore possible
opportunities for expansion of
their activities across the region to service customers that
are involved in cross border operations. Their medium-term
strategic plan envisions DFCU
creating strong linkages into
the regional banking market.
35
36
New Vision Group

3000
New Vision Group

1200
2000
900
1500
600
1000
Volume in 000
Share Price
2500
1500
Volume
Price
300
500
Market
Listing Date
16 December 2004
Market value
1880*
Shares issued
76,500,000
Market Cap
146,100,000,000*
Trading status
Normal
0
Oc
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Oc 005
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2
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l2
Oc 006
t2
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2
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pt 8
20
08
New Vision Group is a limited liability company wholly

owned by the government
of Uganda. It was set up as a
statutory corporation having
been established by law under
the provisions of the NVPPC
Statute No. 8 of 1987. It started
business in March 1986 after
the National Resistance Movement (NRM) took power in
Uganda. Its initial line of business was the production of an
English language newspaper,
The New Vision. Under this
law, the corporation was under

the supervision of the Ministry
of Information, which had the
full authority to appoint the
Board and statutory managers
of the company. The company
remains largely independent,
with financial autonomy and
editorial independence. The
New Vision management set
an objective and progressive
political line, supportive of the
Movement ideals, but critical
of failings, as the basis of its
editorial philosophy.

Newspapers
New Vision the leading English Newspaper in Uganda
Saturday Vision The biggest selling Saturday paper
Sunday Vision The leading Sunday newspaper
Bukedde A luganda lower income market tabloid
Regional newspapers Orumuri (West), Rupiny (North) and
Etop (East) published in Runyakitara, Luo and Ateso.
Websites/Electronic Versions
www.newvision.co.ug carries digital versions of all the products
Other websites include www.jobs.co.ug, www.schools.co.ug, plus
registered websites of all the titles.
Magazines
City Beat Monthly Ugandas only entertainment magazine
Premiership Monthly a definitive analysis of soccer
Flair for HER Bi- monthly ladies magazine for the discerning
woman
Bride & Groom The biggest selling wedding magazine in EA
Others are PASS PLE, PASS O Level, PASS A Level
Commercial Printing services include web and flat sheet from
newspapers to posters, books, calendars and cards and other
products.
Privatisation
In 1993, the PERD Act

(Cap.98) listed NVPPC in
Class 2 where the company
was to be privatised, but the
GoU would retain majority
shareholding.
In order for NVPPC
to comply with USE requirements for listing, the Ministry of Finance, Planning
and Economic Development
(Privatization) incorporated
NVPPCL. This was followed
by a share split of each ordinary share into 508.65 ordinary shares thus increasing the
authorized, issued and fully
paid up ordinary shares from
98,300 ordinary shares to
50,000,000. Finally, a shareholders resolution was passed
declaring a dividend of Ushs
19,660,000, and capitalizing
that dividend into 1,000,000
authorized and issued ordinary
shares of the Company. The
authorized and issued shares
of the Company thereby increased from 50,000,000 to
51,000,000 ordinary shares of
a nominal value of Ushs 19.66
each, resulting in an authorized and issued share capital
of Ushs 1,002,660,000.
Rights Issue
A recent rights issue in August

2008, that was oversubscribed
enabled the New Vision raise
another 28 billion Ushs in
Capital which will be used to
fund the Companys Expansion plan for a new Warehouse,
Factory and office Block and to
increase its Printing Capacity
and enable further investment
in the Radio and TV Stations.
Profitability and Future

prospects
Since listing on the Uganda

Securities Exchange the New
Vision share price has increased
from Ushs 200 at the IPO to a
high of Ushs 2,500 In that period a total of Ushs 2.2bn has
been paid in dividends to the
New Vision shareholders.
The New Vision has registered consecutive profits ever
since they began and recently
declared a pre tax profit of
Ushs6.7bn for 2007. With the
addition of a radio and TV station and with the acquisition of
new state of the art equipment,
New Vision projects the performance to increase further.
Three Radio Stations, Vision Voice, Bukedde FM and Radio West

TV station (Operational by mid 2009)
37
38
Stanbic Bank Uganda

150
300
Stanbic Bank
120
Share Price
250
90
200
Volume in 000,000
Volume
Price
60
150
Market
Listing Date
25th January 2007
Market value
180*
Shares issued
5,118,866,970
Market Cap
972,584,724,300*
Trading status
Normal
30
Performance
The bank once again recorded

strong financial performance
in the year ended 31 December
8
00
t2
Se
p
l2
00
8
Ju
r2
Ap
20
n
The bank was founded in

Uganda as the National Bank Of
India in 1906, which after several name changes became Grindlays Bank. When the Standard
Bank Group bought the Grindlays network in Africa it also, in
October 1993, re-established a
connection with Uganda.
In February 2002,
Stanbic Bank bought 90%
shares into Uganda Commercial Bank, a largely retail government-owned bank that operated a countrywide network
consisting of 67 branches.
On 25th January 2007,
Stanbic Bank Uganda Limited
was listed on the Uganda Securities Exchange following the
largest initial public offering
in the history of Uganda that
closed on 22nd December 2006.
20 % of the shares were on offer at the IPO of which 10%
were from the Government of
Uganda and another 10% from
Stanbic Africa Holdings. Since
listing, Stanbic Uganda shares
have dominated trading on the
Exchange, contributing over
80% of the Exchanges turnover.
00
08
7
Ja
00
t2
Oc
00
l2
Ju
00
r2
Ap
Ja
20
07
100
2007. During the year, Stanbic

Bank Uganda rolled out several
new products and services with
the aim of improving service
delivery to its customers as
well as widening our product
offering in order to meet their
clients banking requirements.
Among the new products
launched were mortgages and
new transactional accounts
called Pure Save and Transact
Plus that offer greater flexibility to their customers. The new
services introduced were Internet banking which enables the
customers to transact from any
place which has internet connectivity; while a new information technology (IT) platform
known as Business Online was
launched enhancing electronic
banking offering to Corporate
clients. In addition, several IT
projects were implemented to
enhance the banks IT infrastructure which is the backbone of its operations.
Introduction of new
products led to a strong
growth in the loan book as the
bank continued to attract customer deposits which grew by
19.4%. The bank improved its
efficiency which led to a cost
to income decline to 58.7%
The Bank registered a net
profit after tax of UShs 53.0 billion which is UShs 13.5 billion
(34.2%) higher than the previous
year. The growth in profitability was driven mainly by strong
revenue growth whereby net interest income increased by Ushs
17.8 billion and non interest revenue by Ushs13.4 billon; offsetting overall cost growth of Ushs
11.6 billion.
Other note worthy
achievements for the year were
43% return on equity. Shareholders funds increased by
21%. In addition, Earnings
per share went up by 34%. The
proposed dividend per share
was Ushs 6.64 up by 9.6%
from the previous year.
Products
Apart from the wide range of

products, Stanbic Bank is licensed as a merchant banker,
stockbroker and financial adviser by the Uganda Capital
Markets Authority.
Social responsibility
Stanbic Bank believes in making a difference by giving back

to the communities in which it
operates and as such it engages
in and sponsors several activities towards the achievement of
that goal. The Banks social responsibility programmes cover
areas such as health, housing
construction, education support, sports development and
tree planting among others.

Kampala Kids League: Stanbic Bank is the major sponsor
of the Kampala Kids League
(KKL) initiated with Bank
support in 1998 to give health
and sporting skills to boys and
girls aged below 15 years of
age. Competing in football,
basketball and cricket, over
14,000 boys and girls have
gone through this programme.
KKL has also trained more
than 3000 adult volunteers to
help in organising the games.
Future Outlook
The expected continued economic growth of about 6%

means that the banking industry will continue to benefit. However, there will be
increased competition as new
entrants enter the market
.with the possibility of market
Consolidation and a declining
interest rate environment. Being the dominant bank in the
industry, we are likely to be
targeted by other banks seeking to grow market share.
With the strategies
initiated in past years, coupled
with our enhanced product
and service offering, upgraded
electronic banking systems, a
knowledgeable and dedicated
staff, we remain confident that
the bank shall continue maximizing shareholders value in
the year ahead.
39
The leading manufacturer of Bricks & Tiles in Uganda
With the major upgrading and expansion of the factory at kajjansi with
acquisition of another complete production line and construction of a
modern factory in Kamonkoli in eastern Uganda, Uganda Clays continues to be a market leader in clay building products.
40
Uganda Clays Limited

15
25000
Volume
Price
9
Split of 1:100
10000
Uganda Clays was incorporated in 1950 as a private

Limited company by a Greek
Cypriot family. After shareholding changing hands a
couple of times, the final
shareholders just before the
IPO were NHCC, White
Tower Corporation , Charles
Schaffer and Government of
Uganda. UCL is Located 14
kms south of Kampala city
on Entebbe road, Kajjansi,
UCL is placed on the rich clay
ridge, north of Entebbe on
Lake Victoria. The area is rich
in high quality and consistent
clay deposits. An independent
geological report that was carried out in 1999 showed that
the deposits had a life expectancy of 30 years then.
Listing on USE
UCL was the first company to

be listed on the Uganda Securities Exchange (USE) in
January 2000 with a total of
500,000 Ordinary shares of
Ushs.1,000 as nominal value
offered to the public through
an IPO at Ushs.4,000 per
share. A total of Ushs. 1.3 Billion was raised then and the
offer was 14% oversubscribed.
In November 2006, the company had a 10:1 share split to
08
08
20
20
n
pt
Ja
Se
06
05
20
n
Ja
20
n
Ja
20
n
Ja
20
20
20
20
n
Ja
n
Ja
n
Ja
n
Ja
04
0
03
0
02
01
5000
Volume in 000,000
12
15000
00
Share Price
20000
Uganda Clays Limited
Split of 1:10
improve on its liquidity on the

stock market. At the time, the
price had reached a high of
Ushs. 22,580, hence the split
brought the price to Ushs.
2,255 and nominal value of
Ushs. 100. Total number of
shares in the market therefore
increased to 5,000,000 shares.
The company had another
share split of 1:100 in August
2008 bringing the price of its
shares from Ushs 11,000 to
Ushs100
Rights Issue
In January 2008, the company

had a 4:5 Rights Issue. An
Uganda Clays main business
is the production and sale
of building clay products in
housing and construction,
including; roofing tiles,
bricks, blocks, decorative
gilles, ventilators, floor tiles,
pipes and cable covers.
additional 4,000,000 shares

were put on offer to the public
at a discounted price of Ushs.
2,650. This brought the new
total number of shares listed
to 9,000,000. The offer was
10% oversubscribed and the
proceeds from the issue were
used to partly fund the con-
Market
Listing Date
18 January 2000
Market value
190*
Shares issued
900,000,000,000
Market Cap
171,000,000,000*
Trading status
Normal
struction of the new factory at

Kamonkoli, Budaka District
in Eastern Uganda. The proceeds from the issue were used
to offset 37% (Ushs. 9.6 Billion) of the bank loan for the
new factory project.
Profitability
Half year results reflect a 16%

increase in turnover over the
first half of 2007, on the back
of increased production due to
the completion of the installation of two new Hoffman
Kilns in 2007.
Net earnings are up
37% as a result of an increase
in revenues across all product
lines. No interim dividend
has been declared this year,
but this can be justified by
the companys CAPEX programmes. Net current liabilities are up 42% on the back
of the companys obligations
made to finance its CAPEX
programmes.
Future Prospects
According to the 2008/2009 financial budget, the construction

industry grew by only 6.0 %
compared to 14.3% the previous
financial year. Private construction is however expected to be
slowed down by the rising cost
of construction materials arising from the international price
increase in steel, cement and
other related materials. However, the construction boom

that fuelled the introduction of
different mortgage products on
the market gives UCL competitive edge as a major supplier.
This is supported by the fact
that the company has an established state of the art laboratory
and has employed a good quality manager.
The regional market
gives UCL an opportunity to
expand and supply products
into Southern Sudan, Rwanda,
Burundi and Western Kenya.
Setting up of the Kamonkoli
factory in Eastern Uganda is
the first phase of meeting regional growth objectives. This
project is expected to start
operations in late 2008 and
will produce an additional
30,000 tonnes p.a. using the
latest state of the art technology from Morando, a leading
Italian firm. It is expected to
enhance the companys supply and distribution channels
especially to the Eastern &
Northern parts of the country,
Kenya and most importantly
Southern Sudan. The clay deposits in Kamonkoli are expected to last over 50 years.
The Company is also looking
at buying a majority stake in
a Rwanda and in the process
locking in the Burundi and
Congolese markets.
41
National Insurance Corporation
National Insurance Corporation- To be Listed Soon. NIC

was established by an Act of
Parliament under the National
Insurance Act 1964. In order
to pave way for Privatisation,
it was incorporated as National
Insurance Corporation Ltd
(NIC) in November 2000. In
June 2005, the Government of
Uganda successfully divested
60% of its shares in NIC to Industrial and General Insurance
Plc (IGI) of Nigeria through an
international bidding process.
The Government retained
40 % shareholding after privatization in 2005 which it intends
to sell through an initial public
offer. The listing of NIC is another milestone in the privatization program embarked upon by
the Government of Uganda.
The offer for the sale of
40% of the shares of NIC is
aimed at providing the members
of the public resident in Uganda
and foreign investors with an
opportunity to own shares in a
leading insurance company in
Uganda.
In 2006 NIC was rebranded into a major corporate
refocusing initiative and repositioned as the insurance company
of choice in the insurance subsector. NIC has the reputation
for exceptional competence in
the delivery of customer-centric
service and product innovation. National Insurance Corporation Limited has witnessed
tremendous growth since its
privatization in 2005 due to
the introduction of customer
centric products and service excellence. Within three (3) years
of privatization, NICs gross
premium income grew by 100%
from Ushs6.5billion in 2005 to

Ushs13billion in 2008. Within
the same period, profit after
tax grew from Ushs981million
in 2005 to Ushs2.3billion in
2007. The company has consistently paid dividends since 2005.
NIC is the most profitably run
and the largest insurance company by net assets. NIC has the
largest spread throughout the
country with 15 branches and
area offices and over 24 outlets
nationwide.
2005
2006
2007
Asset base
UGX 50.22bn
UGX 43.79bn
UGX 53.26bn
NIC Notable Facts
NIC has an asset base of over

Ushs.50bn
NIC has the reputation of exceptional competence in the
delivery of Customer centric
services and product innovation; recent products introduced include the School Insurance plan and Employee
Insurance Plan.
Because of its strong asset
base, NIC was able to settle
the largest ever claim in the
Ugandan Insurance Industry
history to the tune of Ushs11bn to the Government of
Uganda for the loss of MI172 Presidential Helicopter
To increase its presence in
the region, NIC opened a
subsidiary in Southern Sudan
which was launched in 2007
To bring services closer to the
market, NIC maintains the
largest network in Uganda
with over 15 Branches spread
across the country.
In 2007 & 2008, NIC was
awarded a certificate as the
most innovative company in
Product Development in the
Uganda Insurance Industry
2005
2006
2007
Gross Premium Income

UGX 6.85bn
2005
UGX 7.74bn
2006
UGX 13.08bn
2007
Total Income
UGX 6.76bn
UGX 8.42bn
UGX 10.9bn
The remarkable performance registered by NIC in the last

three (3) years is attributable to the vision of new management who have bought international experience to bear on
the companys operation. The impact of customer-centric approach and product innovation has resulted in growth of gross
premium income by over 100% between 2005 and 2007.
43
Trading Statistics
Month
Year
Volume (No. of shares)
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
Year
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
Year
January
February
March
April
May
2000
2000
2000
2000
2000
880
1780
1270
575
570
3,975,250
8,071,900
5,777,775
2,619,600
2,613,100
19
21
28
13
993,813
1,008,988
825,396
436,600
653,275
2001
2001
2001
2001
2001
19,295
26,576
78,760
65,327
69,050
24,284,700
32,736,420
111,242,200
82,544,800
132,997,000
20
26
41
55
22
3,469,243
4,676,631
15,891,743
10,318,100
26,599,400
2002
2002
2002
2002
2002
4,515
174,773
40,784
66,251
178,203
20,769,000
240,748,120
43,583,520
34,784,260
95,713,678
Deals
36
34
53
54
Trade Days
20,769,000
60,187,030
14,527,840
4,969,180
13,673,383
11
Year
2003
2003
2003
2003
2003
1,075
1,130
5,153
29,949
6,189
2,309,025
5,251,185
16,884,660
40,064,250
11,087,060
12
11
46
84
52
577,256
1,312,796
2,814,110
5,008,031
3,927,724
11
Turnover (Ushs)
Daily AVG TO
Daily AVG Trades
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
44
June
July
August
September
October
November
2000
2000
2000
270
50
690
1,239,250
229,500
10
December
2000
2000
2000
2000
405
10,470
5,470
53,850
3,176,500
1,865,025
13,058,350
6,772,600
70,764,250
14
18
24
17
16
247,850
57,375
352,944
310,838
1,865,479
967,514
23,588,083
2001
2001
2001
2001
2001
2001
2001
39,712
51,275
380
13,530
245
1,450
1,805
52,757,900
62,491,325
1,761,600
16,376,800
1,135,575
2,411,500
2,935,500
37
23
11
20
16
8,792,983
7,811,416
440,400
3,275,360
1,135,575
482,300
733,875
2002
2002
2002
2002
2002
2002
2002
867,412
230,722
177,661
2,551
63,693
66,546
20,800
419,644,761
257,067,850
652,590,732
5,972,599
25,897,680
56,132,630
14,872,000
36
52
50
35
30
40
69,940,794
32,133,481
108,765,122
995,433
2,877,520
8,018,947
7,436,000
2003
2003
2003
2003
2003
2003
2003
4,465
29,201
2,798
154,508
6,995
2,002
797
27,494,070
49,586,930
12,056,490
123,333,325
32,253,300
4,476,365
5,980,290
47
30
26
30
13
11
1,847,843
9,917,386
2,411,298
20,555,554
8,063,325
895,273
1,993,430
45
Trading Statistics
Month
January
February
March
April
May
Year
2004
2004
2004
2004
2004
4,427
3,700
96,897
11,390
800
21,828,860
14,704,550
61,289,735
10,297,800
624,000
Deals
25
17
32
Trade Days
5,457,215
2,450,758
10,214,956
1,716,300
208,000
2005
2005
2005
2005
2005
28,941
33,470
1,452,061
75,254
4,582,075
10,030,660
13,105,860
428,816,770
28,420,420
2,215,056,780
27
25
58
42
129
1,671,777
2,621,172
53,602,096
3,552,553
276,882,098
16
2006
2006
2006
2006
2006
348,615
2,442,597
208,018
662,574
818,415
160,687,640
3,996,993,605
111,009,465
361,093,900
423,793,190
89
171
86
106
90
26,781,273
570,999,086
15,858,495
51,584,843
60,541,884
15
24
12
15
13
Turnover (Ushs)
Daily AVG TO
Daily AVG Trades
Year
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
Year
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
Year
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
Year
Turnover (Ushs)
Deals
Trade Days
Daily AVG TO
Daily AVG Trades
2007
2007
2007
2007
2007
36,096,503
37,148,619
76,995,316
36,062,277
53,136,097
8,352,439,955
5,573,642,180
11,808,718,930
6,391,322,585
7,976,982,555
533
784
2,336
1,433
1,345
10
12
12
12
13
835,243,996
464,470,182
984,059,911
532,610,215
283,047,312
53
65
195
119
103
2008
2008
2008
2008
2008
16,033,731
30,244,416
20,826,468
36,062,277
53,136,097
4,046,268,025
13,544,445,620
18,818,241,145
6,391,322,585
7,976,982,555
1,139
1,365
1,475
1,433
1,345
13
12
12
12
13
311,251,387
1,128,703,802
1,568,186,762
532,610,215
613,614,043
88
114
123
119
103
46
June
July
August
September
October
November
December
2004
2004
2004
2004
2004
2004
2004
2,931
31,274
4,064
1,186
15,161
153,552
92,424
6,387,725
50,870,405
19,980,500
5,168,000
20,237,610
48,732,070
27,436,240
10
35
14
18
40
20
1,596,931
8,478,401
2,854,357
1,722,667
5,059,403
6,961,724
5,487,248
2005
2005
2005
2005
2005
2005
2005
1,162,047
1,063,354
332,601
172,934
244,694
85,913
4,188,397
451,780,130
383,889,310
126,098,435
117,201,550
135,526,825
50,199,300
1,642,608,360
65
44
69
86
86
73
58
50,197,792
14,010,937
54,841,330
13,022,394
16,940,853
7,171,329
273,768,060
10
11
10
10
2006
2006
2006
2006
2006
2006
2006
492,882
383,910
627,004
2,713,055
994,827
2,176,203
3,625,481
243,121,990
412,635,735
326,387,580
1,207,652,630
507,473,815
933,461,815
1,535,872,560
81
91
129
90
94
67
76
13
13
13
11
27,013,554
31,741,210
25,106,737
92,896,356
46,133,983
103,717,979
307,174,512
10
15
2007
2007
2007
2007
2007
2007
2007
23,948,740
29,323,215
30,269,768
24,718,167
63,050,679
29,507,904
43,855,244
3,396,567,745
4,772,328,250
4,700,226,650
3,650,397,185
11,940,777,585
6,140,483,605
10,500,034,115
1,086
1,155
1,229
935
1,345
1,335
822
12
14
14
12
13
12
613,614,043
340,880,589
335,730,475
304,199,765
918,521,353
511,706,967
1,166,670,457
91
83
88
78
103
111
91
2008
2008
2008
2008
2008
2008
2008
23,948,740
32,728,334
18,688,225
26,433,094
3,396,567,745
15,979,661,540
12,064,383,900
6,266,044,625
1,086
1,329
1,446
2,119
12
14
12
12
283,047,312
1,141,404,396
1,005,365,325
522,170,385
91
95
121
177
47
Trading Statistics
Turnover Comparison 2000 - Sept 2008
Volume Comparison 2000 - Sept 2008
100000
300000
250000
80000
200000
60000
150000
40000
100000
20000
50000
20
00
/0
1
20
01
/0
2
20
02
/0
3
20
03
/0
4
20
04
/0
5
20
05
/0
6
20
06
/0
7
20
07
/S
ep
t0
8
20
00
/0
1
20
01
/0
2
20
02
/0
3
20
03
/0
4
20
04
/0
5
20
05
/0
6
20
06
/0
7
20
07
/S
ep
t0
8
Turnover (Ushs million)
Shares Traded (thousands)
Transaction Comparison 2000 - Sept 2008
Market Cap Comparison 2000 - Sept 2008
15000
12000
6000
5000
4000
9000
3000
6000
2000
3000
1000
20
00
/0
1
20
01
/0
2
20
02
/0
3
20
03
/0
4
20
04
/0
5
20
05
/0
6
20
06
/0
7
20
07
/S
ep
t0
8
20
00
/0
1
20
01
/0
2
20
02
/0
3
20
03
/0
4
20
04
/0
5
20
05
/0
6
20
06
/0
7
20
07
/S
ep
t0
8
Deals
Market Capitalization (Ushs bn)
FY January 2000 - September 2008

Stock
Deals
Volume (No. of Shares)
Turnover (Ushs)
% Volume
% Turnover
BATU
945
9,319,488
7,339,938,955
1.33%
3.89%
BOBU
1,795
6,200,934
14,092,144,755
0.89%
7.48%
DFCU
2,583
55,542,355
29,326,316,650
7.94%
15.56%
EABL
55
364,735
843,906,915
0.05%
0.45%
KA
63
1,012,912
189,944,189
0.14%
0.10%
2,225
6,573,600
4,990,275,270
0.94%
2.65%
576
23,648,356
8,460,396,010
3.38%
4.49%
SBU
18,769
581,349,860
103,045,543,730
83.06%
54.67%
UCL
3,345
14,994,920
17,023,298,696
2.14%
9.03%
UCLR
189
885,112
3,159,946,885
0.13%
1.68%
Total
30,547
699,894,272
188,477,117,055
NVL
NVLR
Source: USE Trading Department
48
USE ALSI Trend map - October 2003 - Sept 2008

1400
1200
ALSI
1000
800
600
400
200
08
pt
Se
08
n
Ju
08
Fe
b
7
t0
Oc
07
n
Ju
Fe
b
07
6
Oc
t0
06
n
Ju
06
Fe
b
5
t0
Oc
05
n
Ju
05
Fe
b
Ju
Oc
t0
03
n
03
Fe
b
Oc
t0
Government Bond Yield Curve as at 30th September 2008

16%
12%
8%
4%
Sept - 08
Sept - 07
12
24
36
48
60
Months
72
84
96
108
120
Source: USE Trading Dept.
49
Economic Indicators
Headline and Underlying Inflation rate Jan 2000 - Sept 2008
40
35
30
25
20
Headline
Underlying
Core
EFU
15
10
5
Source Bank of Uganda and UBOS
0
Ja
n
Ma 00
y
0
Se 0
p
0
Ja 0
n
Ma 01
y
0
Se 1
p
0
Ja 1
n
Ma 02
y
0
Se 3
p
0
Ja 3
n
Ma 04
y
0
Se 4
p
0
Ja 4
n
Ma 05
y
0
Se 5
p
0
Ja 5
n
Ma 06
y
0
Se 6
p
0
Ja 6
n
Ma 07
y
0
Se 7
p
0
Ja 7
n
Ma 08
y
Se 08
pt
08
-5
Interest Rates (end period-weighted discount rates) Jan 2000 - Sept 2008
30
25
20
91 Days T/Bill
182 Days T/Bill
273 Days T/Bill
364 Days T/Bill
15
10
5
Source Bank of Uganda
Ja
n
0
Ma 0
y
0
Se 0
p
00
Ja
n
0
Ma 1
y
0
Se 1
p
0
Ja 1
n
0
Ma 2
y
0
Se 3
p
03
Ja
n
0
Ma 4
y
0
Se 4
p
04
Ja
n
0
Ma 5
y
0
Se 5
p
05
Ja
n
0
Ma 6
y
0
Se 6
p
06
Ja
n
0
Ma 7
y
07
Se
p
0
Ja 7
n
0
Ma 8
y
0
Se 8
pt
08
Inter bank Foreign Exchange Mid- Rate Jan 2000 -Sept 2008
2000
1900
Exchange Rate
1800
1700
1600
Source Bank of Uganda
Ja
n
Ma 00
y
Se 00
p
0
Ja 0
n
Ma 01
y
Se 01
p
0
Ja 1
n
Ma 02
y
Se 03
p
0
Ja 3
n
Ma 04
y
Se 04
p
0
Ja 4
n
Ma 05
y
Se 05
p
0
Ja 5
n
Ma 06
y
Se 06
p
0
Ja 6
n
Ma 07
y
Se 07
p
0
Ja 7
n
Ma 08
y
Se 08
pt
08
1500
50
Capital Markets; Charting a Path for Economic Growth and Development

The Capital Markets Authority would like to congratulate the Uganda Securities Exchange on the 10th
anniversary.
We are proud to be contributing towards the economic growth and development of Uganda by
regulating and promoting capital markets in Uganda, with the overall objective of investor protection.
At its inception in 1996, Capital Markets Authority was given the mandate to;
Regulate and promote the development of capital markets in Uganda
Approve stock exchanges
License broker/dealers, investment advisors, fund managers, collective investment scheme
managers and trustees
Approve all offers of securities to the public
Approve collective investment schemes (mutual funds)
Industry performance
In the 12 years of its existence, the capital markets industry in Uganda has accomplished the
following;

10 companies listed on the stock exchange

Issuance of over 50 government bonds
Issuance of 5 corporate bonds of which 2 have been redeemed;
3 unit trust funds
24 Licensees including 1 stock exchange, 10 broker/dealers, 5 fund managers, 1 unit trust manager,
1 unit trust trustee and 22 investment advisors.
The full list of licencees and their addresses can be obtained on our
website; www.cmauganda.co.ug
With the recent passing of the Securities Central Depository Bill by the Parliament of Uganda, we look
forward to celebrating more years of efficient trade, increased company listings and greater economic
growth through regional integration.
Capital Markets Authority
8 Floor Jubilee Insurance Center
14 Parliament Avenue
P.O. Box 24565 Kampala, Uganda
Tel: (256-414) 342788, (256-312)264950
Fax: (256-414) 342803
E-mail: info@cmauganda.co.ug; Website: www.cmauganda.co.ug
Licensed to act as both broker/dealers and Investment

Advisors of the Uganda Securities Exchange
African Alliance
Crested Stocks And Securities
MBEA Brokerage Services Ltd.
6th Floor Workers House

Pilkington Road, Kampala
Tel: +256 414 235577
Fax: +256 414 235575
Email: info@africanalliance.co.ug
6th Floor Impala House

Plot 13/15 Kimathi Avenue
P. O. Box 31736, Kampala
Tel: +256 414 230900
Fax: +256 414 230612
Email: info@crestedsecurities.
com
44 Lumumba Avenue
P O Box 24613, Kampala
Tel: +256 414 231960
Fax: +256 414 342045
Email: info@mbea.net
Dyer and Blair Uganda Ltd.
Plot 13, Kololo Hill Drive

Tel: 0414 340018/0312264775/6
Fax: 0414 340016
Baroda Capital Markets Ltd.

Plot 18 Kampala Road
P O Box 7197, Kampala
Tel: +256 414 233 680/3
Fax: +256 414 258263
Email: bob10@calva.com
Crane Financial Services Ltd.
Crane Chambers
Plot 38 Kampala Road
Tel: +256 414 341414/345345
Fax: +256 414 231578
Email: Cfs@
cranefinancialservices.com
Ground Floor, Rwenzori House

Tel: +256 414 233050/0312
265469
Email: shares@dyerandblair.com
Equity Stock Brokers (U) Ltd.
Orient Plaza, Plot 6/6A
Kampala Road
Tel: +256 414 236012/3/4/5
Fax: +256 414 348039
Email: equity@orient-bank.com
Renaissance Capital Ltd.
Made in Africa (IB) EA Ltd.

Communication House
1 Colville Street
P. O. Box 1610 Kampala
Tel: 256 0414 233843
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PAN AFRICAN STOCKBROKING, RESEARCH AND ADVISORY SERVICES

step into our world

Trade multiple products on the same platform

MillenniumIT (UK) Limited

Foreword by the Governor,

his publication commemorates ten years

I note with satisfaction the growth in the

We are proud to be associated with the Uganda Securities Exchange.

Message from the Chairman

e welcome you all to

and technological assistance among

The Bourse Celebrating 10 years of Use

in market capitalization over the years

Message from the CEO

be enhanced now that the Securities

What next for USE?

The Bourse Celebrating 10 years of Use

Japheth Katto, Chief Executive Officer, Capital Markets Authority

Building the Blocks of

n behalf of the Capital Markets Authority let me take

same time facilitating the development of capital markets in Uganda.

The Bourse Celebrating 10 years of Use

A small institutional investor base is

Message from the ASEA President

Governing Council Members....................... 8

Libyan Stock Market

economy and the sustained growth of the country`s di-

of this year with five companies . two more companies

verse economic sectors, the chairman of the LSM is ex-

have since listed on the exchange, which now has a total

pecting diversity to be reflected in the index, both by

market capitalization of approximately $1 billion and an

Libyan companies seeking to raise capital via the ex-

average daily turnover of about 300,000 Libyan dinar or

change and by the increasing number of foreign players

entering the country through joint ventures, who are

The index is currently composed of banks and financial

The LSM was initially set up as an office at the central

Bank of Libya (CBL) which began trading shares in 2003

Economic and social Development Fund. Libya`s public

. In 2006, Mr. Alshahomy got the green light from offi-

sector commercial bank, Gumhouria Bank and National

cials to make the stock market independent from the CBL,

commercial Bank, are among the seven entities being

to develop a sound regulatory framework, IT infrastruc-

prepared for upcoming initial public offering (IPOs) by

seven of the fifteen Libyan stock brokerage firms that

offices in Tripoli and Benghazi, and has taken the best

have opened their doors in the last year .

aspects of world stock markets in developing a flexible

With the increasing liberalization of the Libyan

LSM is a member of following organizations:

Union of Arab capital markets.

Bank of commerce & develpoment

African Securities Exchange Association

Assaray trade and investment bank

Non - trade Gumhouria bank

Mr. Suliman Alshahomy

Non - trade Altejari bank.ly

Libya insurance .co

United insurance .co

Libyan stock market

Sahara insurance .co

10 Non - trade Alenma company for engineering industries