DFCU Bank net profit after tax increased by 21% to UGX 73.4 Billion from UGX 60.9 billion according to figures the Bank released to its shareholders yesterday.

DFCU Bank registers Ush73.4B profit, Karuhanga re-elected Chairman

DFCU Bank net profit after tax increased by 21% to UGX 73.4 Billion from UGX 60.9 billion according to figures the Bank released to its shareholders yesterday.

The increase was mainly driven by a significant increase in efficiency and cost management.

“Loans and advances grew by 10% from UGX 1,398 billion to UGX 1,539 billion as a result of increased disbursements and focus on continuous monitoring of the asset quality for the entire portfolio. The increase in loans and advances was organic,” indicated a statement the bank issued after its 55th Annual General Meeting in Kampala.

Overall interest expenses reduced by 7% from UGX 104.7 billion to UGX 97.8 billion showing an improved efficiency in the liability mix as a result of management’s effort to shed off expensive funding and concentrate more on cheaper liabilities. Consequently, the net interest income increased by 3% from UGX 221.1 billion to UGX 227.4 billion.

According to the statement, Non-funded income in terms of fees and commissions grew by 28% from UGX 51.2 billion to 65.4 billion as the bank continues to harness the benefits of the investments in technology and growth in the customer base.

“Operating expenses reduced by 4% from UGX 202.2 billion to UGX 193.1 billion showing improved operating efficiency. As a result, the cost to income ratio reduced from 66.2% in 2018 to 60.6% in 2019,” added the key facts document the Bank issued.

The Bank said that the asset base increased by 1% from UGX 2,916 billion to UGX 2,958 billion, upheld by strong growth in loans and advances.

“The Group’s deposit base grew by 3% from UGX 1,979 billion to UGX 2,039 billion. The growth was as a result of both newly acquired and existing clients across the business segments. Management implemented a clear strategy of growing the liability base, as well as retention of the existing customer relations.

“Shareholders’ funds grew by 9% from UGX 521.5 billion to UGX 569.7 billion as a result of an increase in retained earnings.”

The bank added that due to the uncertainty world-wide and domestic economies caused by the emergence of the global COVID-19 (Corona Virus) pandemic, Bank of Uganda, the regulator of the banking industry in April 2020 directed all supervised financial institutions to defer payment of all discretionary payments including dividends.

“The dividends declared by the Bank form part of the dividend pool paid to dfcu Limited shareholders. Suffice to say the company has consistently paid a healthy dividend over the years and will continue to do so in future,” added the statement.

Relatedly,  Elly Karuhanga, who has been the DFCU Bank Chairman, was re-elected to the post. Karuhanga is an advocate by Training and Founding Partner of Kampala Associated Advocates.

He is the Founder President and Chairman of the Governing Council of the Centre for Arbitration and Alternative Dispute Resolution. He is currently the Chairman of British American Tobacco (BAT), the Uganda Chamber of Mines and Petroleum Practice and the Private Sector Foundation.

Also, Kironde Lule, who has over 30 years’ experience in financial management and auditing was also re-elected to the Board. Previously, he was a Finance Director in the Aga Khan Foundation (USA), ICF (Tanzania) and Director Financial Reporting in the Global Fund for Vaccines (USA).

He served as the Commissioner Internal Audit -Uganda Revenue Authority and an Audit Partner in Deloitte & Touche (Swaziland & Cote d’Ivoire). He is a fellow of the Institute of Chartered Accountants in England and Wales and a member of the American Institute of Certified Public Accountants.

Dr Aminah Zawedde was also appointed a director to the board. She has over fifteen years’ experience in the IT services sector both as an academician and as a technical advisor.

Zawedde holds a PhD in Computer Science from the Eindhoven University of Technology in the Netherlands, a Masters in Computer Science from Makerere University, a Postgraduate Diploma in Educational Technologies from the University of Cape Town in South Africa, a Bachelor of Science in Statistics and Economics from Makerere University and is a Certified Information Systems Auditor.

She brings on board vast experiences in IT initiatives and strategic leadership from both the public and private sector.