dfcu Bank delivers impressive first-half performance, net profit soars 45%

KAMPALA, UGANDA – dfcu Bank has announced a stellar financial performance for the first half of 2024, with net profit after tax surging 45% to UGX 42 billion. This remarkable growth is a testament to the bank’s effective risk management strategies, diversified earnings, and strong capitalization.

The bank’s significant reduction in credit losses from loans and advances was a key driver of this growth. Net loan loss provisions decreased by a staggering 114% from UGX 50 billion in June 2023 to a credit of UGX 6 billion in June 2024. This achievement is attributed to sustained recovery efforts and a deliberate strategy to diversify the loan portfolio, thereby reducing concentration risk.

Furthermore, dfcu Bank’s interest expense costs decreased due to a targeted approach to balance deposit drivers. This, combined with growth in fees and commission arising from an increase in transacting customers, contributed to the bank’s impressive bottom line.

The bank’s asset base grew by UGX 6.5 billion, primarily due to a 4% increase in investment in government securities. This strategic move diversifies earning assets and demonstrates management’s cautious approach to credit risk.

dfcu Bank’s deposit base remained stable at UGX 2,319 billion, with management focused on achieving a balance in the deposit mix to maintain interest costs within target.

Shareholders’ funds grew by 6% to UGX 684 billion, driven by an increase in retained earnings. The bank’s capital ratios remain robust, with core and total capital ratios standing at 29% and 30%, respectively. Liquidity position also remains strong, with an average liquid assets ratio above 40%.

“We are pleased with our first-half performance, which demonstrates our commitment to prudent risk management, diversified earnings, and strong capitalization,” said Charles M. Mudiwa as Managing Director and Chief Executive Officer. “We are optimistic about future growth and higher financial performance, driven by our strategic initiatives and the resilience of our business model.”