It does not ensure that new entrants to the banking industry have sufficient capital to support their operations before they reach a scale where they can begin to generate profits. It has also fallen way below the minimum statutory levels imposed by our neighbours in East Africa and elsewhere in Africa.
Although the banking system as a whole in Uganda is currently well capitalised, the evolution of the banking system over the long term is likely to intensify the risks to which banks are exposed. Hence I believe that the changes I have just described will help to ensure that banks are better able to withstand shocks to their balance sheets.