The Bank of Uganda has announced that Finance Trust Bank Limited has been authorised to transition from a Tier I commercial bank licence to a Tier II credit institution licence, effective April 1, 2026, marking a significant strategic shift for the lender.
In a notice to the public, the central bank said Finance Trust Bank has been granted a three-month transition period running from January 1 to March 31, 2026. During this period, the institution will make the necessary arrangements to phase out products and processes that require a Tier I commercial bank licence. The Bank of Uganda said the phased approach is intended to ensure a smooth transition for customers while minimising any potential disruption to the stability of the financial sector.
The change in status follows a decision by Finance Trust Bank’s Board of Directors to reposition the institution and focus more deliberately on its core customer base. By operating as a Tier II credit institution, the bank is expected to concentrate on targeted lending and financial services aligned with its revised strategic direction.
The central bank noted that Finance Trust Bank is adequately capitalised and meets the minimum capital requirements prescribed for a Tier II credit institution. This, according to the regulator, provides assurance that the institution remains financially sound as it undertakes the transition.
Tier I commercial banks in Uganda are permitted to offer a full range of banking services, including accepting deposits from the public and providing a wide array of financial products. Tier II credit institutions, while still regulated by the Bank of Uganda, operate under a narrower mandate, typically focusing on credit provision and related services.
The Bank of Uganda reassured the public that it continues to closely supervise regulated financial institutions and remains committed to safeguarding the stability and integrity of the financial system. Customers of Finance Trust Bank have been advised that further details regarding the transition and its implications will be communicated during the transition period.