Previous empirical analyses have found that bank privatizations are more successful when the government fully relinquishes control, when the bank is privatized to a strategic investor, and when foreign-owned banks are allowed to participate in the bidding. The privatization of Uganda Commercial Bank (UCB) to the South African bank Stanbic met all these criteria, suggesting that it is a likely candidate for success. But other features suggest reasons for caution: UCB dominated the Ugandan banking sector prior to privatization and the institutional environment in Uganda was less favorable than in many of the middle-income countries looked at in earlier empirical studies. Despite these concerns, the privatization appears to have been relatively successful. The portfolio of the privatized bank, which was cleaned prior to sale, remains relatively strong and profitability and credit growth are now on par with other Ugandan banks. Though market segmentation remains a concern since Stanbic faces little or no direct competition in many remote areas, some early results suggest that access to credit has improved for some hard-to-serve groups.
Details
-
Author
-
Document Date
2007/11/01
-
Document Type
Policy Research Working Paper
-
Report Number
WPS4407
-
Volume No
1
-
Total Volume(s)
1
-
Country
-
Region
-
Disclosure Date
2010/07/01
-
Disclosure Status
Disclosed
-
Doc Name
Bank privatization in Sub-Saharan Africa : the case of Uganda commercial bank
-
Keywords
Privatization;Finance & Private Sector Development;Regional Program on Enterprise Development;share of government security;access to financial service;holdings of government security;
- See More
Downloads
COMPLETE REPORT
Official version of document (may contain signatures, etc)
- Official PDF
- TXT*
- Total Downloads** :
- Download Stats
-
*The text version is uncorrected OCR text and is included solely to benefit users with slow connectivity.
Citation
Clarke,George R. Cull,Robert J. Fuchs,Michael J.
Bank privatization in Sub-Saharan Africa : the case of Uganda commercial bank (English). Policy Research working paper ; no. WPS 4407 Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/539991468310727480/Bank-privatization-in-Sub-Saharan-Africa-the-case-of-Uganda-commercial-bank