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Centenary Bank Profit Up By 8% As Non-Performing Loans Hit Shs35bn

Centenary Bank, the leading indigenous bank in Uganda has overcome the economic headwinds of 2016 to record impressive results for the year ended December 2016.

According to the bank’s financials released on Monday, Centenary Bank posted a net profit of Shs109.9bn in 2016, up from Shs101.6bn recorded the previous year, representing a growth of 8.2%.

From the statement, it is clear that the improved performance was due to general improved performance of all key parameters.

For example, the bank’s total income increased by 17.3% to Shs463.9bn in 2016, up from Shs393.9bn in 2015. This was mainly driven by growth in loans advanced to customers and an increase in transaction volumes.

While many banks were cautious in their lending, Centenary’s loans advanced to customers grew to Shs1.24trn in 2016, up from Shs1.02trn in 2015.

Customer deposits also grew impressively to Shs1.62trn in 2016, up from Shs1.38trn in 2015, representing a growth of 17.9%.

Consequently, the bank’s total assets increased to Shs2.31trn, up from Shs1.97trn.

However, the bank’s total expenses increased by 22.8% to Shs316.0bn, up from Shs257.4bn in 2015. The bank attributed it to “the bank’s expansion, improvements in staff welfare and increased investments in business technology.”

On the negative side, Non-Preforming Loans (NPLs) increased to Shs35.6bn in 2016, up from Shs27.4bn in 2015.

Bad debts written off also increased to Shs11.2bn in 2016, up from Shs7.4bn in 2015.

As a result of the good performance, the bank’s shareholders are all smiles as proposed dividends have been increased to Shs27.6bn, up from Shs25.5bn in 2015.

Commenting on 2017 outlook, Centenary Bank Managing Director, Fabian Kasi, said the Bank commenced the year by successfully implementing a new core banking system that is already improving service delivery to their clients.

“The Bank will rollout agent banking and bancassurance and also enhance its mobile banking platform by offering more functionality,” Kasi said in a statement.

He added: “Within the year, the Bank shall also be migrating to a more secure ATM card system which is based on PIN and Chip technology and also introduce a new method of identifying customers based on biometric technology.”

 

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