The Big Story

Uganda Development Bank Assets Hit Record UGX486 billion Uganda Development Bank (UDB) Bank assets grew by 31% in 2019, reaching UGX486 billion, up from UGX370 billion in 2018.

Mrs Patricia Adong Ojangole, UDB managing director

The growth is attributed to the increase in the Government of Uganda capital contribution as well as draw down of lines of credit making the bank one of the heavy weights in the 2nd Tier commercial banks.

The bank’s financial performance, as showed in its financial statement, improved significantly; profit after tax improved by 7% from UGX 9.49 billion in 2018 to UGX 10.14 billion in 2019 while the balance sheet grew by 31% to yield at UGX 486.37 billion.

This tremendous performance, according to managing director Patricia a. Ojangole, was triggered by a 74% increase in Government of Uganda capital contributions, improving from UGX 48.15 billion in 2018 to UGX 83.73 billion in 2019.

The government intervention into the bank’s operations, according to Mrs Ojangole, resulted into major milestones. For instance, UDB created 4,343 new jobs and maintained 28,313 jobs in 2019; of these, 36% were held by women and 67% were taken on by the youths.

She also attributed the bank’s success to implementation of various strategic initiatives which included implementation of specialized units in the bank to provide additional support to the private sector, conscious decision to mainstream and champion financial sustainability, value creation through partnerships and several others.

‘’We continue to strengthen our development impact monitoring, evaluation and learning framework so as to not only ensure that development outcomes generated by the projects funded by the bank are adequately tracked but also support assessment-at- entry with the view to ensure that only projects that demonstrate a high promise to create the highest additionality are financed and supported,’’ she says.

Mrs Ojangole, who has been at the helm of the bank since 2012, added ‘’we remain cognizant of the need to embed sustainability in our operations and to align our interventions to the national priorities as enshrined in Uganda’s Vision 2040 and the new National Development Plan (NDPIII). The bank has reviewed its strategic plan to cover the next five-year period 2020/2024 to include a sustainability strategy.’’

Profit for the year partly grew by 7 per cent to UGX10.14 billion from the UGX9.4 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.

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Also, gross loan and advances rose by UGX 46 billion (15%) during the year. The bank disbursed UGX183.9 billion to projects in 2019 compared up from UGX 154.5 billion in 2018.

Additionally, various lines of credit with its development partners during the year resulted in a 22% increase in borrowing from UGX 97.03 billion in 2018 to UGX 118.00 billion in 2019

Finance minister Matia Kasaija (2nd left) and Investment minister Evelyn Anite 3rd left), UDB Shareholders and Mr. Felix Okoboi UDB Board Chairman at the Annual General Meeting at the Ministry of Finance

Interest Income                                                                                    

The bank’s net interest increased by 17% to UGX 38.9 billion from UGX 33.2 billion in 2018. Interest and similar income grew by UGX 6.5 billion (18%) in 2019 triggered by a 15% growth in the gross loans and advances. Interest expense and similar charges increased by 40% to UGX 3.1 billion from UGX 2.2 billion in 2018 as a result of 22% increase in borrowings arising from new lines of credit of UGX 49.1 billion secured by the bank in 2018 compared to UGX 40.3 billion drawn down in 2018.

According to Mrs Ojangole, the bank has reviewed its strategic plan to cover the next 5-year period 2020/2024 to include a sustainability strategy.

She notes that in the year 2020, the bank will support interventions along three High Impact Goals, that is, projects and programs that aim to reduce poverty in Uganda, building a sustainable food system in Uganda, promoting Uganda’s industrialization saying the bank remains committed to its mandate of fast-tracking Uganda’s socioeconomic development.

Key highlights

  • Total assets increased by 31% reaching record high to UGX 486 billion from UGX 370 billion in 2018.
  • Profit after tax improved by 7% from UGX 9.49 billion in 2018 to UGX 10.14 billion in 2019
  • Net interest increased by 17% to UGX 38.9 billion from UGX 33.2 billion in 2018
  • Interest expense and similar charges increased by 40% to Ushs 3.1 billion from Ushs 2.2 billion in 2018
  • Gross loan and advances rose by UGX 46 billion (15%) during the year. The Bank disbursed UGX 183.9 billion to projects in 2019 compared up from UGX 154.5 billion in 2018

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