Kampala — The Centenary Bank and European Investment Bank (EIB) have signed a financial contract that would help Ugandans with commercial businesses access long term loans and leases.

Centenary Bank officials said the deal which was sealed on Monday would pave way for them to access a credit line to lend to commercial private sector businesses like tourism, food processing, manufacturing and health and education projects.

According to the Bank's Managing Director, Mr John Giles, the repayment period would stretch between three to1 ten years given that investors are expected to take huge loans in excess of one billion shillings. "Today we come to sign a financial contract with EIB.Through this operation, we shall contribute more to larger investment in the Ugandan private sector" he said.

Mr Regan Otte, EIB associate director described the deal as a forward move to supporting Uganda's local indigenous bank. This comes at a time when demand for credit is increasing according to the monthly economic and financial indicators report by Bank of Uganda for the month of August where domestic credit increased by Shs169.6billion from Shs1,908billion between June and July.

Mr Giles earlier said that Centenary Bank would be able to lend more than Shs1billion depending on the nature of investment and board's approval, which was not possible previously because most Ugandans make short-term deposits on their bank accounts.

EIB is European Union (EU)'s long-term financing arm. Its operations focus on supporting economic and social cohesion within the EU. It is non-profit making, and financed through borrowing on the financial markets, and through contributions by its shareholders from the EU member states.