Uganda: Govt Raises Security Fund Interest Rate to 10 Percent

The National Social Security Fund (NSSF) on Monday announced 10% interest rates from 7% for its members.

Finance minister Maria Kiwanuka, flanked by the NSSF Executive Director, Richard Byarugaba announced the new rate at a news conference in the ministry’s board room in Kampala.

In 2010, NSSF doubled the interest rate from 3% to 7%.

The rate of interest went up from 3% from the previous financial year to 7% because of the improved financial performance, the NSSF chairman, Vincent Ssekono, said.

Ssekono attributed the improved financial stand to the improved performances in the stock market and the positive performances of the fixed income investments such as the treasury bills, bonds and fixed deposits in banks.

The managing director, Richard Byarugaba, said the real estates also performed well, with the exception of those under question such as the Nsimbe estates.

The Fund keeps about sh800b on fixed deposits in various commercial banks. Many of these deposits are renewed when they mature after one year.

The Fund shares improved. It owns shares in Housing Finance Bank (50%), TPS Serena Hotel (20%), Vision Group (19.6%), DFCU (5.91%), Stanbic Bank (2.79%), Uganda Clays (32.5%), Safaricom (2.38%) and Bank of Baroda (1.49%).

The Fund has 450,000 members and boasts of an asset base of sh1.6 trillion, according to the June 2010 unaudited report, up from sh1.3 trillion in June 2009.

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