first place. particularly, the banking sector in uganda has not suffered the large deterioration in asset quality that affected banks in many countries. the average capital adequacy ratio of ugandan banks has remained well above the prudential minimum of 12 per cent for the past three years and the banks ’ overall liquidity remained good. however caution should be exercised to ensure that, in the medium to long term, banks remain solvent, profitable and liquid while allowing for increased intermediation to finance economic activity. in addition, it is important that financial innovation and outreach continue to take place to meet customer needs. in this regard, the bank of uganda, in 2009 set up the financial stability department which was charged with the mission of identifying and assessing potential systemic risks to the structure and functioning of the financial system and to develop measures to reduce those risks. bank of uganda will continue to pursue a monetary policy stance aimed at boosting aggregate demand and growth while maintaining price stability. the bank of uganda also intends to introduce major reforms to the monetary policy in the next five years ; which will include shifting to an inflation targeting regime as well as the transition to a single currency in the east african community. i wish to stress that to enable adoption of these new reforms as well as a smooth transition to a monetary union and advancement of data harmonization efforts in the east african community ; it is of paramount importance that financial institutions, among other data providers, submit timely and accurate statistics, based on international best practice. the reporting forms, which we are about to launch, have been designed to enable you to submit data to bank of uganda, which is comparable across nations both within and outside the east african community. these revised forms will enable bank of uganda to collect more comprehensive and appropriate data to guide the conduct of monetary and credit policies. finally, i thank you for all the efforts you have put in, the comments and feedback on the proposed changes, as all of these have enabled the revision of the reporting forms to be a success. we look forward to your continued efforts in the improvement of the quality of statistics. i wish you fruitful deliberations during this half day workshop. i now declare the new reporting forms launched. i thank you.

of four ( 4 ) commercial banks and others are in the process of joining. this development will go along way to enhance the payment system by facilitating customer payments for utilities and purchases using debit cards. licensing of the inter - bank switching system marks a significant step in bank of uganda ’ s efforts to widen the financial sector, which will result into the creation of a wider range of delivery channels to banks. as you are all aware continued efforts to improve efficiency and mitigate risks in the payment system resulted into the implementation of a number of initiatives including a real time gross settlement ( rtgs ) system known as uganda national inter - bank settlement ( unis ) in february 2005. as of now, about 80 % of large value and time critical payment transactions pass through the system leaving 20 % to pass through the traditional clearing system. likewise, to broaden the outlet and variety of institutions, which offer financial services, three new micro deposit taking institutions ( mdis ) were licensed in 2005 bringing the total number of licensed mdis to four. the significance of licensing mdis has far reaching impact on promoting the savings culture and thereby fostering the accumulation of funds for investment purposes. bank of uganda therefore encourages the council of the institute of bankers to initiate appropriate educational training programmes from which these new institutions can access information and expertise necessary for their future development. bank of uganda on its part will continue to promote the development of mdis through prudential regulation and supervision so that they conduct their businesses in a manner that ensures safety of depositors ’ funds. notwithstanding the above developments, the financial sector still continues to face new challenges in their operations including globalization, relatively high interest rates, frauds and forgeries and lately the energy crisis. with respect to globalization, this has resulted into a fast pace of technological advancements in products and systems deployed in the global markets. these technological advancements have dramatically diversified the risk profiles of financial institutions. to address this new development, bank of uganda has compelled all supervised financial institutions to institute credible risk management frameworks which can adequately identify, measure, monitor and control all risks inherent in financial institution business in a timely and ongoing manner. regarding the high interest rates charged on loans, although these have remained relatively stable in the last two years or so and while inflation has been maintained at single digits for over a decade, lending rates have continued to remain at high levels and at times as high as 26 % p. a in some banks. yet, the weighted interest rates on deposits continue to