Stanbic Bank Uganda has posted Shs200bn net profit in 2017, up from Shs191bn in 2016. This represents 5% growth.
Releasing the results at Sheraton Hotel Wednesday morning, Stanbic Bank Uganda CEO, Patrick Mweheire said 2017 was a challenging year, noting that they had to do ‘smart things’ to record impressive results.
The results indicate that customer deposits grew by 18% to Shs3.6 trillion in 2017, up from Shs3 trillion a year earlier.
Loans advanced to customers grew by 8.5% to Shs2.2 trillion, from Shs2 trillion in 2016.
Further, the bank’s total assets grew to Shs5.4 trillion, up from Shs4.6 trillion. This represents about 18% growth.
Mweheire revealed that in 2017 inflation was controlled and the exchange rate was generally stable. This, he said, saw Bank of Uganda reduce the Central Bank Rate (CBR), a benchmark lending rate to commercial banks to a record 9%. He noted that Stanbic has also reduced its Prime Lending Rate to a record 17%, which he says is the lowest on the market.
He noted that the reduction in CBR cost the bank about Shs20bn. This saw the bank’s Net Interest Income reduce to Shs353bn in 2017, down from Shs376bn. Total Income also reduced to Shs636bn in 2017, down from Shs643bn in 2016.
Mweheire attributed the good performance to improved efficiencies in both its control environment and management process, helping reduce operating expenses by approximately Shs15bn year on year.
This, he said ensured that despite a reduction in the bank’s overall income, the bank’s net profit increased to Shs200bn.
“This outcome confirms our customer centric approach is working. Our invstments in the further integration of digital technology within our product and service offering also contributed to a reduction in our cost to serve while giving our customers greater access and flexibility to bank if, when and whichever way they wanted,” he said.
Analyzing the results, Sam Mwogeza, the Chief Financial Officer at Stanbic revealed that then bank reported improvement across all key financial metrics.
“Or credit loss ratio was just 1.3% compared to 1.8% registered in 2016 and continues to be well below the industry average. In addition, we managed to reduce our cost to income ratio by 1.6% to 50.5% while our earning by share climbed to Shs3.92 per share from Shs3.73 in 2016,” he said.
He added: “Our shareholders will be pleased to hear off the bank’s strong performance the board has approved a dividend pay-out of Shs90bn, an increase of 50% over 2016.”
Stanbic bank is one of the best performing listed companies on the Uganda Securities Exchange.
Keep it up my bank. But you never recognize the clients in reducing interest rate.