Uganda Development Bank held its Annual General Meeting (AGM) on 28th May 2020. The meeting was held at the Ministry of Finance, Planning and Economic Development. The Financial performance for the year ended December 31st 2019 was shared with the shareholders of the bank, Minister for Finance Hon. Matia Kasaija and State Minister for Finance for Investment and Privatization Hon. Evelyn Anite.
The Financial performance was as follows:
- The Bank realized a profit for the year of Ushs 10.14 billion, representing a 7 % growth from the Ushs 9.4 billion realized in 2018 on the back of growth in funding and capitalization of the Bank as well as increase in loan disbursements to development projects.
- The Bank’s net interest increased by 17% to Ushs 38.9 billion from Ushs 33.2 billion in 2018. Interest and similar income grew by Ushs 6.5 billion (18%) in 2019 as a result of a 15% growth in the gross loans and advances.
- The bank’s total assets increased by 31% from Ushs 370 billion to Ushs 486 billion on the back of increase in the Government of Uganda capital contribution as well as draw down of lines of credit.
- Gross loan and advances rose by Ushs 46 billion (15%) during the year. The Bank disbursed Ushs 183.9 billion to projects in 2019 compared up from Ushs 154.5 billion in 2018 representing a 19%. The proportion of the term loans (patient capital) is 81% of the Banks portfolio.
- The Bank received additional capital contribution from the Government of Ushs 87.7 billion in 2019 compared to Ushs 49.1 billion in 2018 representing 79% increase in capitalization of the Bank. The total capital of the Bank is now Ushs 375 billion.
The social – economic impact was as follows:
- Annual turnover of firms increased by 3% from UGX 1.738Tn in 2018 to UGX 1.795Tn in 2019. Profitability of enterprises supported increased by 10% from UGX 161Bn in 2018 to UGX 177Bn in 2019. Foreign exchange earnings for the economy increased by 17% from US$ 81M in 2018 to US$95M in 2019.
- To further boost government efforts towards domestic revenue mobilization, enterprises supported by UDBL registered 6% increase in tax contribution from UGX 133Bn in 2018 to UGX 141Bn in 2019.
- The level of employment increased by 18%, an upsurge from 23,970 in 2018 to 28,313 in 2019. This implies that 4,343 new jobs were created by enterprises financed by UDB.
During the meeting, the shareholders communicated an increase in UDB’s share capital from UGX 500bn to UGX 2Tn with UGX 1Tn as initial investment meant to stimulate the Agriculture, Agro-processing and Manufacturing sectors. Additionally, it was resolved that the UGX 10.14bn profit after tax made by the Bank was to be retained as capitalization. The shareholders called upon the Board & Management to work towards realizing a reduction of interest rates to 10% to support with the increase of production and exports capacity.
The Chairman Board of Directors UDB, Mr. Felix Okoboi expressed his gratitude to the shareholders for the increased capitalization. He noted the timeliness given the dire impact of COVID 19 on the Ugandan economy.
At the same event the revised UDB 5 year strategic plan (2020-2024) was launched. The Purpose Statement of this strategy is “Improving the Quality of Life of Ugandans” which will be achieved through the attainment of 3 High Impact Goals which are to:
- Reduce Poverty in Uganda
- Build a Sustainable Food System for Uganda
- Industrialize Uganda