A joint International Monetary Fund-World Bank team conducted an assessment update of Uganda's financial system in connection with the Financial Sector Assessment Program (FSAP) in November, 2004. The purpose of the mission was to help the Ugandan authorities identify financial system strengths and weaknesses with a view to implementing an action plan to increase the system's contribution to economic development. This report is an overall assessment of progress since 2001 of the FSAP and policy agenda. It examines the efficiency and outreach of the financial system and finds: a) a healthy but underdeveloped financial system; and b) improving financial system efficiency and outreach. The second part assesses the promotion of term financing and developing capital markets in the areas of: pensions, term financing, the Uganda Development Bank, the Uganda stock exchange, housing finance, and domestic government debt markets. The third part focuses on financial sector supervision, including safety net and crisis management.