Dfcu Bank has reported a major improvement in its financial performance after posting a 45% rise in net profit to Shs 42 billion for the first half of 2024, supported by reduced credit losses, stronger income streams, and disciplined cost management.The latest results represent a significant recovery from the Shs 29 billion profit recorded during the same period in 2023, reflecting the lender’s continued efforts to strengthen its operations and improve overall financial stability.
The bank attributed the growth mainly to a sharp turnaround in loan loss provisions, which improved by 114%. Net loan loss provisions moved from a loss of Shs 50 billion in June 2023 to a credit position of Shs 6 billion in June 2024, following deliberate measures to improve loan recovery and portfolio management.dfcu said the reduction in credit losses was achieved through proactive risk management, diversification of its lending portfolio, and efforts to reduce exposure to high-risk borrowers.
These measures helped lower the bank’s non-performing loan ratio from 15.2% to 5.2% within one year.The bank’s asset base also recorded steady growth, increasing to Shs 3.16 trillion in June 2024 from Shs 3.15 trillion in December 2023. The growth was supported by a 4% rise in investments in government securities as the institution maintained a cautious approach to lending amid changing economic conditions.dfcu maintained a stable deposit base of Shs 2.32 trillion, with management focusing on improving the balance of deposits while controlling the cost of funds. Shareholders’ equity also increased by 6%, rising from Shs 644 billion in December 2023 to Shs 684 billion by June 2024 due to stronger retained earnings.
The lender remained financially strong, with core capital and total capital ratios standing at 29% and 30% respectively, while its liquidity position stayed above regulatory requirements with liquid assets averaging more than 40%.With improved profitability, stronger risk controls, and a solid capital position, dfcu Bank said it is well prepared to expand its services, support customers, and pursue further growth opportunities in Uganda’s competitive banking sector.
