DFCU bank has announced that it is changing the bank tariff following a string of poor results in terms of profits recorded over the years.
A Bank Tariff means any fee schedule in respect of any fees for the opening, operation and maintenance of any Account or the provision of any Service.
“Dfcu bank wishes to advise customers that the bank’s tariff is changing effective 13th June 2022. The new tariff will be displayed al all branches,” the bank said in a notice.
The move suggests that bank is adjusting in their operations to offset the decline in profits.
DFCU released its results for the year ending December 31, 2021 showing that its profits had shrunk by a significant 45.7% to Shs13.2 billion from Shs24.3 billion in 2020, sending shockwaves amongst its major shareholders.
“DFCU bank like some other players in the market experienced a drop in profitability by 45% in 2021. However, the bank posted most of its income from earnings on interest on loans, but almost experienced a wipeout of this income due to provisioning for bad loans that accrued in the wake of the Covid 19 crisis,” Mathias Katamba, the bank’s Managing Director said.
The Board of the bank then suggested that no dividends would be extended to the shareholders in the wake of enlisting a drop in profits of Shs11 billion so that it can keep the financial institution with enough liquidity to deal with any possible emergency.
Its asset performance for the last five years has generally been minimal, from Shs3,030.6 billion in 2017, down by 4.7% to Shs2,888.3 billion in 2018; rising by 2.9% to Shs2,972 billion in 2019; again, rising by 19.1% to Shs3,539.4 billion in 2020, before slumping by 10.2% to Shs3,177.6 billion in 2021.
Further, overall, in these 5 years, Compounded Annual Growth Rate in assets has been a mere 1%. Yes, a mere 1%.
Big shareholders, according to insider sources, are waiting for the Annual General Meeting (AGM) to see how to revamp the struggling bank. Some top executives are likely to leave after the AGM.
Dfcu’s scandalous acquisition of Crane Bank put BoU in bad light to the extent that sections of the public began to question the integrity of the top managers. Former deputy governor Dr Louise Kasekende and Bagyenda left unceremoniously.
The sale of Crane Bank was a curse to both BoU and dfcu more so that it brought about court cases that the majority owner of Crane Bank Sudhir Rupareria won.
