PARLIAMENT, Uganda — Businessman Hassan Basajjabalaba has disputed claims that he received Shs140.487 billion from Bank of Uganda, telling Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises that a substantial portion of the money was never paid.
Basajjabalaba appeared before the COSASE committee on Wednesday to explain the long running financial dispute involving his HABA Group of Companies, Bank of Uganda and several commercial banks.
The committee is investigating a Shs140.487 billion exposure recorded in Bank of Uganda’s financial statements. The amount relates to letters of comfort issued by the central bank to commercial banks to support financing for HABA Group. The Auditor General’s report shows the amount has remained on Bank of Uganda’s books, with the exposure fully impaired as of June 2024.
COSASE Chairperson Muwada Nkunyingi said the committee wanted Basajjabalaba to explain the history of the money, what was actually paid and the current status of the outstanding claims.
The committee had earlier questioned Bank of Uganda officials over why the exposure had remained unresolved for years. Bank officials told MPs that the support was provided following instructions from the Ministry of Finance and that the central bank had been consulting government and external lawyers over possible recovery options.
Basajjabalaba, however, presented a different account.
He said the dispute goes back to the early 2000s, when his companies obtained contracts from the former Kampala City Council to manage or redevelop several markets and other public properties.
He said his companies invested heavily in the properties before the government changed its policy on the management of public markets and terminated the arrangements.
According to his account, the affected properties included Nakasero Market, Shauri Yako, Nakawa and City Square. He said his companies had paid rent, premiums and other amounts to the city authority and had also invested in renovating and developing some of the sites.
Basajjabalaba told MPs that after the contracts were terminated, government agreed to compensate his companies for their investments and losses.
He said an interministerial technical committee was established to assess the claims and that the eventual compensation was to be based on an agreed formula.
According to Basajjabalaba, government then proposed using Bank of Uganda guarantees to enable commercial banks to provide financing while the compensation dispute was being settled.
He said Bank of Uganda issued guarantees involving about $34.5 million for several commercial banks and another $26 million guarantee in his name.
Basajjabalaba said the $34.5 million guarantee was equivalent to about Shs82.817 billion at the exchange rate used at the time, while the $26 million guarantee was equivalent to about Shs63.2 billion.
However, he told the committee that the full amounts were never paid.
“According to us, we did not receive the 140 billion from them. They paid parts and parts were not paid,” Basajjabalaba said.
He told MPs that of the $34.5 million guarantee, Bank of Uganda paid about $25 million, leaving about $10 million unpaid. He also said the $26 million guarantee to him was not fully honoured.
During questioning, committee members asked him to put his figures into shillings and clearly state the amount he was claiming from Bank of Uganda.
Basajjabalaba said his outstanding claim was about Shs87 billion, before interest, based on the exchange rates contained in Bank of Uganda correspondence.
He explained that about Shs24.02 billion, equivalent to $10 million under the agreed conversion rate, remained unpaid from one part of the guarantee, while about Shs63.2 billion relating to the $26 million guarantee also remained outstanding.
The figures presented by Basajjabalaba differ from the Shs140.487 billion figure appearing in Bank of Uganda’s financial statements. The committee pressed him on the difference.
Basajjabalaba said his calculations covered a wider set of transactions and included another claim connected to City Square, bringing his total claimed amount to about Shs168.8 billion.
He said the additional amount was not reflected in the Auditor General’s figure because some payments made by Bank of Uganda, including money paid directly to the bank and Uganda Development Bank, were treated differently in the records.
The committee also questioned Basajjabalaba about whether he had actually received any part of the money recorded by Bank of Uganda.
He maintained that he had received only part of the amounts guaranteed and that the outstanding balance remained the subject of disputes and court proceedings.
Basajjabalaba also referred to several court cases arising from the transactions. He said one dispute involved guarantees issued to commercial banks, while other cases concerned the compensation and the surrender of leases and subleases.
He told MPs that his companies had surrendered some of the properties following agreements with government but retained interests in City Square and Nakasero while the outstanding disputes continued.
The businessman said he would submit court judgments, government documents, technical reports, correspondence from Bank of Uganda and an approval from the Attorney General to support his account.
“I am going to submit the evidence, the documentary evidence, to those facts,” he told the committee.
The committee directed him to provide the documents so that they could be used for further verification.
Basajjabalaba also raised allegations about the way Bank of Uganda has handled the related litigation and its use of external lawyers. He suggested that prolonged litigation had contributed to the failure to resolve the outstanding claims.
The allegations were not established during the hearing, and committee members directed him to keep those claims separate from his formal submission and support any allegations with evidence.
The dispute has a long legal history.
A 2020 Constitutional Court decision had ordered recovery of compensation payments linked to the market contracts. However, the Supreme Court overturned that decision in September 2025, holding that the Constitutional Court had exceeded its jurisdiction in handling the dispute. The Supreme Court ruling left any further recovery to be pursued through the appropriate legal process.
Bank of Uganda has previously told COSASE that the Shs140.487 billion exposure arose from letters of comfort issued to commercial banks to facilitate loans to HABA Group, and that the resulting obligation was recorded as due from the government.
The central bank has also said it is consulting the Ministry of Finance and its lawyers on the matter. COSASE has questioned why no direct recovery action against HABA Group had been taken despite the exposure remaining on the books for years.
Basajjabalaba told the committee that this was the third parliamentary investigation into the matter since the original dispute arose.
He asked COSASE to bring the matter to a conclusion after considering the documentary evidence he said he would submit.
The committee is expected to examine the documents from Basajjabalaba alongside Bank of Uganda records, government correspondence, Auditor General findings and the relevant court decisions before making its findings.
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