Stanbic Holdings reports UGX155 bn in H1 2021 net profit, backed by innovative credit expansion to pandemic-hit economy Unlike some financial institutions that continue to react to the pandemic by squeezing back on lending, Stanbic’s performance shows that you can still innovatively lend to pandemic-hit clients and still make money for your shareholders.

Stanbic Uganda Holdings Limited (SUHL), a member of the Standard Bank Group, has today released its H1 2021 results, reporting powerful performance across all business fundamentals, compared to the same period in 2020.

According to results released, today, Friday, August 6, 2021, customer deposits increased to UGX5.7 trillion in June 2021 compared to UGX5.2 trillion in June 2020, indicating a 9.5% growth.

Assets also grew by 9.8% driven by an increase in loans and advances amounting to UGX 3.8 trillion compared to UGX 3.4 trillion in June 2020.

As a result, SUHL earned UGX154.9 billion in net profit representing an impressive 21.5% growth from the same period last year.

Growth in net profit was driven by sturdy growth in trade revenue which accounted for UGX 37.5 billion as well as better management of loan impairments, which was reduced by UGX 11.7 billion as compared to the same period last year.

The statement also said that the company remains well capitalised above the minimum regulatory requirements, which will allow it to “continue financing the private sector through the second half of the year.”

According to a company statement, most of this growth was driven by Stanbic Bank Uganda Limited, SUHL’s anchor subsidiary.

Apart from Stanbic Bank Uganda Limited, other SUHL subsidiaries are Stanbic Properties Limited; Stanbic Business Incubator Limited; FlyHub Uganda Limited, and SBG Securities Uganda Limited. The creation of the holding company corporate structure started in 2018 and was completed in 2020.

Delicate balance

Andrew Mashanda, the Chief Executive for Stanbic Uganda Holdings Limited said: “The first six months of 2021 have been quite challenging especially with the second wave of Covid-19. Businesses and individuals have felt the impact of the pandemic and as an institution, we have done much to support our customers, our staff, and communities through this unprecedented period.

“Despite the attendant challenges, we waded through, to post what our shareholders will appreciate as resilient performance, with good growth across all key performance indicators. Our Return on Equity stood at 23.2% up 1.6% year on year. This strong performance was led by our anchor and largest subsidiary, Stanbic Bank Uganda Limited (SBUL),” Andrew Mashanda said.

Anne Juuko, Chief Executive Stanbic Bank Uganda said, the bank’s growth was underpinned by “significant growth in our small and medium enterprises segment as we continued to support them through this challenging period.”

“Overall, through our financing to boost private sector growth, we saw loans and advances grow by 9.8% to UGX 3.8 trillion from UGX 3.4 trillion in June 2020,” she said.

She said the bank had made deliberate interventions to drive economic recovery in several ways including the creation of the Enterprise Economic Restart Fund (EERF) that aims to raise and provide up to UGX 350 billion ($100 million) in low-cost financing to sectors and groups impacted by the pandemic.

“We also launched a new value proposition aimed at revitalizing the operations for Savings and Credit Co-operatives (SACCOs) and Village Savings and Loans Associations (VSLAs) across Uganda. The bank has so far provided UGX 5.1 billion in financing that has reached over 261,497 members,” she said.

The bank also reported that during the period under review, it had continued to honour its commitment to support communities, and to this effect, invested over UGX 2.1 billion into various Corporate Social Investment initiatives.

“We made tangible contributions to education through the National Schools Championship programme reaching over 60,000 students; promoted better access to Health Care through the Maternal Health drive; and joined the fight against COVID-19 with a donation of over UGX 200 million to the Ministry of Health providing oxygen cylinders and PPE for front line workers,” Juuko said.

Juuko said that the bank had in the first half of the year focused on how to achieve a fine balance between growing shareholder value while supporting customers to remain resilient through the pandemic.

“This performance shows that we were successful in growing shareholder value while supporting our customers to remain resilient; we achieved this through many innovative initiatives which we intend to sustain through the second half of the year and beyond,” Chief Executive Anne Juuko said.

Going forward

Andrew Mashanda said that moving forward, SUHL would in the second half, prioritise investing in technology and digital solutions to enhance the bank’s service offerings and customer experience.

“We shall also focus on continuously managing our risks across all areas of operations to ensure business continuity and implement the sustainability priorities as a true testament to our purpose-Uganda is our home, and we drive her growth,” he emphasised.   

About Stanbic Bank

Stanbic Bank Uganda is part of the Standard Bank Group, Africa’s largest bank by assets. Standard Bank Group reported total assets of R2.3 trillion (about USD163 billion) as of 31 December 2019, while its market capitalization was R277 billion (USD20 billion). The group has direct, on-the-ground representation in 20 African countries and 5 global financial centres. Standard Bank Group has more than 1,100 branches and 9 000 ATMs in Africa, making it one of the largest banking networks on the continent. It provides global connections backed by deep insights into the countries where it operates.

Stanbic Bank Uganda on the other hand provides the full spectrum of financial services. Its Corporate & Investment Banking (CIB) division serves a wide range of requirements for banking, finance, trading, investment, risk management and advisory services. Corporate & Investment Banking delivers this comprehensive range of products and services relating to investment banking; global markets; and global transactional products and services. Standard Bank’s corporate and investment banking expertise is focused on industry sectors that are most relevant to emerging markets. It has strong offerings in mining and metals; oil and gas and renewables; power and infrastructure; agribusiness; telecommunications and media; and financial institutions.

Stanbic Bank Uganda’s Personal and Business Banking unit (PBB) offers banking and other financial services to individuals and small-to-medium enterprises. PBB serves the increasing need among Africa’s small business and individual customers for banking products that can meet their shifting expectations and growing wealth.