Muwada Nkunyingi (L), the Chairperson of COSASE and George Musisi (C), the Kira MP interacting with Michael Atingi-Ego, the BoU GovernorBy Prisca WanyenyaParliament has criticised Bank of Uganda (BoU) for failing to recover a Shs140.487 billion loan it guaranteed for Habba Group of Companies, owned by businessman Hassan Basajjabalaba’s family, in 2017.The matter came up during a meeting between the Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) and BoU on September 14, 2026, to consider the December 2024 Auditor General’s report.“And you want to say after 9 years, you are not offering yourself to rectify the mess you found because you haven’t gone to court, you haven’t engaged the Habba Group. You are only hiding under a correspondence that you wrote to the Ministry of Finance. What are you saying?” remarked Muwada Nkunyingi, Chairperson of COSASE.The inquest followed a query by Julius Nakiyi (Budadiri East), who cited BoU’s Statement of Comprehensive Income that highlighted a Shs1.4 billion growth that has remained for years after BoU issued letters of comfort to a commercial bank as guarantor for Habba Group.“The Bank of Uganda gave a letter of comfort to somebody to go to a commercial bank, and now I think the loan is becoming bad. Why has the recovery taken so long for that amount of Shs140Bn?” Nakiyi asked.Valentine Ojangole, Chief Accountant at BoU, admitted that the Central Bank guaranteed Habba Group to secure a loan from a commercial bank and that the loan was fully provided for.“What is happening is a process between us and our principals, the Ministry of Finance, to get the issue finally resolved. BoU has written to the Minister requesting for audience to discuss and resolve the matter,” Ojangole said.The response triggered demands from Muwada for BoU to reveal the directors of Habba Group.Governor Michael Atingi-Ego requested to respond in writing, a request the Committee declined.“Who are the directors of Habba Group? This is our second interface and we are dealing with serious issues of auditing. We want evidence,” Muwada insisted.Dorothy Masifa Ochola, Legal Counsel at BoU, described the matter as a legacy issue, saying she did not know the current directors but at the time the loan was guaranteed, the company was owned by members of the Basajjabalaba family.“We have not directly engaged the company in the recent past. However, the bank has continuously, through its external counsel, sought avenues of recovering the money,” she said.Unsatisfied, Muwada directed Masifa to take an oath, suspecting she was concealing information.“When we seek answers and you are not an accomplice, you ought to assist the committee. So now, let us hold you for your answers,” he ordered.After taking oath, Masifa revealed that BoU guaranteed the Shs140.487Bn loan in 2017 on instructions from the Ministry of Finance, but the company never presented BoU with any security and no action has been taken to recover the funds from the family, save for a recent letter to the Ministry of Finance asking Government to pay the money to BoU.“No, Bank of Uganda did opt for court, but what I am trying to explain is that the court options are not as straightforward, particularly because the guarantee was provided on behalf of Government through the instructions of Government,” she explained.Muwada rejected the explanation: “Do you find it justifiable that since 2017, for 9 years, the Bank is only meeting these external lawyers? At what level are you engaging the Habba Group? Does it add up to a response on such a substantive matter of Shs140 billion?”Following the heated exchange, Governor Atingi-Ego requested more time to review documents regarding the Habba Group loan, saying his team was caught off guard.The post BoU on Spot Over Shs140Bn Loan Guaranteed for Basajjabalaba Firm 9 Years Ago appeared first on Business Focus.