Offshore investors in Uganda gov't securities shift to longer securities

KAMPALA, April 1 (Xinhua) -- Offshore investors in Uganda's government securities are shifting to treasury bonds as opposed to treasury bills due to higher returns, said a senior central bank official on Monday.

Mary Katarikawe, executive director of operations of the Bank of Uganda, told Xinhua in an interview that the offshore investors are preferring Uganda's treasury bonds because of the higher returns compared to rates charged on treasury bonds in developed economies and some emerging economies.

Katarikawe said offshore investors now hold 7 percent in total in Uganda government securities, which translates to 1.8 trillion shillings (493 million U.S. dollars)

Like many other countries in the world, Uganda issues treasury bills and treasury bonds to finance its fiscal deficits.

The ministry of finance said in its February economic performance report that the treasury bills yields decreased across all tenors.

The annualized yield to maturity for 91-day tenor was recorded at 9.8 percent in February, decreasing by 107 basis points from January. The 182-day tenor recorded an annualized yield to maturity of 11.1 percent, a decrease of 112 basis points over the same period.

Similarly, the yield to maturity for 364-day tenor decreased by 158 basis points to 11.5 percent.