Stanbic posts UGX 259 Bn after-tax-profits
Kampala, Uganda | THE INDEPENDENT | Stanbic Bank has announced after-tax-profits of 259 billion Shillings for 2019 up from 215 billion Shillings in 2018, cementing its position as the most profitable bank in the country.
In the financial results published on Thursday, Stanbic said the money it lent to customers grew to 2.9 trillion Shillings in 2019 from 2.5 trillion Shillings a year before – a growth of 14 percent. Outgoing Chief Executive Patrick Mweheire described the results as a “great performance.
The bank’s money came from interest income – money earned on loans given out – and on non-interest income, which has activities such as forex trading, advisory, and fees and commissions. According to the results, more Ugandans save their money with the bank. Customer deposits grew to 4.7 trillion Shillings in 2019 from 3.9 trillion Shillings in 2018.
On the future of the banking sector in Uganda, Mweheire said the biggest challenge remains the high cost of doing business.
“No sustainable business or industry can have its cost growth massively exceed revenue growth for an extended period,” he said. “Unfortunately, with a cost to income ratio of 72 percent across the sector as opposed to a global average of 55 percent, we have a lot of work to do on banking efficiency in Uganda.”
Stanbic’s cost to income ratio was at 49 percent. He said the sector should cut costs through collaboration amongst the financial services sector. He said they need to look for a way to co-exist and thrive with telecoms and mobile money.
Another challenge for bankers is coronavirus, and Mweheire said the impact this will have on the lives of many Ugandans and the economy is immense.
He said “we are looking to several interventions that can support our customers and work closely with the Government of Uganda to ensure a minimised impact on the economy”
Uganda will also be going into elections early next year, a cycle that makes business harder because of uncertainty involved.
Anne Juuko took over effective March 1, 2020, as the new chief executive. Mweheire is now the regional head of Standard group franchises. Stanbic commands the biggest market share at 20.5 percent in Uganda’s banking industry. Its assets hit the 6.6 trillion Shillings mark in 2019 from 5.4 trillion Shillings in 2018.