The Uganda Development Bank (UDB) on Tuesday announced a post-tax (net) profit of Shs 49.8 billion, a 17% uplift from Shs 42.6 billion registered in 2022.

This was during the Annual General Meeting held at the Ministry of Finance, Planning, and Economic Development in Kampala.

The Minister of Finance, Planning, and Economic Development, Hon. Matia Kasaija, lauded the Bank for its exceptional contribution towards the realization of the country’s National Development Plan III and Vision 2024.

“The government has played a pivotal role in significantly contributing to the country’s socio-economic transformation. In 2024 and beyond, the focus will be on mobilizing adequate resources to enable UDB to continue to deliver its mandate. The Bank will also undertake the implementation, aiming to accelerate productivity, import replacement, and export promotion. Additionally, the Bank will advance its holistic sustainability agenda and deepen financial inclusion for SMEs, women, and youth,” he said.

UDB Managing Director Ms. Patricia Ojangole attributed the growth to sustained growth in the bank’s balance sheet, matched by prudent investment in interest-earning assets while ensuring lean operations.

During the period under review, UDB’s net loans expanded to Shs1.47 trillion in 2023, reflecting robust support for the private sector. The bank strengthened its commitment to providing affordable and patient capital, achieving significant milestones amidst economic challenges.

The bank continued to grow, with total assets closing at Shs1.67 trillion in 2023, a 10% uplift from Shs1.52 trillion the previous year. Loans and advances (net) stood at Shs1.47 trillion, growing 20% from Shs1.22 trillion, underpinned by the Shs610 billion in new loan disbursements realized during the reporting period.

To fund the creation of these assets, the bank reinvested UGX467 billion it collected as repayments from its borrowing customers and deployed Shs97.3 billion received from the government as additional capital contributions, complemented by an additional Shs120.5 billion in drawdowns from various lines of credit held with its funding partners.

According to Ojangole, in 2023, the Bank approved Shs691.8 billion and disbursed Shs610 billion, demonstrating a dedicated approach to supporting private business growth.

“UDB remains committed to fostering inclusive economic growth through strategic investments in sectors that drive sustainable development and job creation across Uganda. Our focus on key priority sectors underpins our mission to deliver high socio-economic value and support Uganda’s long-term development goals,” she said.

In 2023, the UDB approved funding of Shs692 billion in new loans to over 200 enterprises in 63 districts nationwide.

“These projects, upon full implementation, are expected to create 18,558 new jobs and generate an output value of UGX11.4 trillion, from which UGX616 billion will be generated as tax revenue for the government and UGX3.34 trillion in foreign exchange earnings,” the bank’s annual report reads in part.

Ojangole says that the bank continues to focus on delivering results using lean and efficient operations. In 2023, the cost-to-income ratio (without impairment) remained subdued at 30.6%. Relatedly, the return on asset ratio improved to 3.12%, while the return on equity also improved to 3.82%.

The Bank continues to leverage its equity to diversify its funding sources to achieve scale while undertaking interventions to optimize its financial, human, technological, and other resources with the view to bolstering operational efficiency. Similarly, to protect shareholder value, the bank continues to exercise prudence in business sourcing to manage its credit risk proactively.

In his conclusion, the Chairman of the Board of Directors of the of the Uganda Development Bank, Mr. Felix Okoboi, pledged the bank’s continued commitment to catalyzing socio-economic development within the country.

“UDB remains resolute to driving inclusive economic growth through innovative financing solutions and leveraging strategic partnerships, reinforcing its role as a catalyst for sustainable development in Uganda,” Mr. Okoboi said.