Stanbic Uganda Holdings Limited (SUHL) has reported record earnings of UGX200 billion for the first half (H1) of 2023 compared to UGX162 billion during the same period last year signifying a rise of 23.5%.

These results were underpinned by a strategy of diversified and robust revenue growth, cost discipline and good risk management in an operating environment marked by high inflationary pressures.

Largely driven by the SUHL anchor subsidiary, Stanbic Bank, SUHL total revenues rose 24.2% from UGX475 billion to UGX590 billion. The other subsidiaries are SBG Securities, Stanbic Properties, Flyhub and Stanbic Business Incubator Limited.

Stanbic Bank net loans and advances to customers expanded by 4.2% to UGX 3.9 trillion, while customer deposits rose by 1.1% to UGX 6.2 trillion. The bank’s total assets also registered growth, surging from UGX 9.3 trillion in the previous year to UGX 9.4 trillion by the end of June 2023.

The bank remitted UGX 149 billion in taxes while also facilitating the collection of an additional UGX 4.1 trillion via Stanbic Bank Uganda channels.

Anne Juuko, the Stanbic Bank Chief Executive said, “Revenue experienced an impressive ascent during the initial half of the year, marking a 24.2% increment to UGX 590 billion, in contrast to UGX 475 billion during the analogous period in the preceding year. This growth encompassed a notable 34.3% surge in interest income, amounting to UGX 355 billion, as well as non-interest income, which generated UGX 235 billion, equivalent to an 11.6% expansion.”

She said, “Despite inflationary pressures and augmented technological investments, the bank adeptly outpaced cost increments, yielding a favourable positive Jaws ratio of 3.1%. Consequently, the bank’s Profit after Tax realized an impressive 23.5% growth, culminating in UGX 200 billion, juxtaposed with UGX 162 billion from the equivalent period in the previous year.”

The’ ‘jaws ratio’ is calculated by subtracting the expense growth rate from the income growth rate. According to Juuko, the challenging macroeconomic factors of the previous year crossed over into 2023 with a double inflation reading of 10.4% seen in the first month.

She said, “The Central Bank responded by maintaining the CBR at 10% to mitigate inflationary pressures. This strategy yielded positive outcomes in the form of a steady reduction in inflation to 4.9% in June from 6.2% in May and 8% in April, per government statistics. Nonetheless, the high inflation raised the interest rates which, naturally, weakened the appetite for borrowing among our consumer and commercial clients market segments. While this was challenging it also presented an opportunity for us to be innovative in solutioning for our customers to drive new growth in assets and liabilities and other income streams.”

Stanbic Bank has maintained its position as the largest provider of household loans in Uganda reflected by a 13% rise of new customers. As part of its compassionate business approach the bank facilitated the extension of loan repayment periods to a maximum of 84 months or seven years for existing and new borrowing clients.

This not only eased monthly repayment obligations, but also provided substantial flexibility to apply for supplementary credit on existing loans, catering to emergent needs such as educational expenses and other needs. Furthermore, Stanbic afforded customers a grace period of up to 75 days prior to the first installment for those availing fresh facilities, along with repayment holidays for individuals seeking loan top-ups. This allowed customers to attend to competing priorities without the worry of going into default.

Also of significance is the increasing popularity of the FlexiPay app, a low cost channel that provides access to financial services for the non-Stanbic customers and the unbanked across Uganda. Use of FlexiPay was up 170% compared to the first half of 2022.

Juuko said, “The continued growth of FlexiPay remains a source of encouragement. As of June 2023, the user base of FlexiPay exceeded 700,000 individuals. Throughout the initial half of the year, the platform registered over 400% growth in transactional volumes processed, encompassing a substantial transaction value surpassing UGX 209.3 billion. The competitive edge of FlexiPay emanates from its affordability, security, and user-centric design, rendering it a prime driver of its sustained growth.”

During the first half of 2023, Stanbic maintained its support of businesses, disbursing UGX43 billion to local content clients in the nascent oil and gas sector and another UGX15.7 billion to 112 SACCOs.

Stories Continues after ad

The Vice president Jessica Alupo has launched a five year digital transformation roadmap aimed at spurring Uganda’s public service system, digital skills,Innovation and Entrepreneurship and others.
Speaking at the launch, Alupo said today is a landmark moment in the history of Uganda as we confront the changes brought about by the advent of a digital age.
“The roadmap will usher in a new era of sustainable social and economic transformation across Uganda. The digital age is part of us and every search and text, connection represents a collective shift in the global context and environment,” she said
The contribution of ICT to Gross Domestic Product (GDP) is estimated at over 9%, significantly contributing to national revenue. The proportion of employment in the ICT sector is 2.3 million people.
“ICT and innovation are not mere passwords. They are often instruments that can spur the creation of jobs and spur the development of the country,” she said.
Aminah Zawedde, the permanent secretary for ministry of ICT said, the road map is not merely a set of strategies and initiatives; it symbolizes our commitment to innovation, inclusivity, and progress for all Ugandans.
“The 5-year digital transformation roadmap is anchored on the Digital Uganda Vision 2040 of transforming Uganda into a modern and prosperous country,” she said.
Anchored on five pillars, she said we must and will empower our youth with the skills needed for the jobs of the future, encourage entrepreneurship and innovation, and create an environment where digital solutions can flourish.
“As we launch the Digital Transformation Map of Uganda, let us also be mindful of the responsibilities that come with this transformation. Ensuring the security and privacy of our citizens’ data remains key by building robust cyber defences to safeguard our digital infrastructure while promoting digital literacy,” she said.
Elsie Attafuah, the UNDP resident representative said If this Digital Transformation Roadmap is implemented successfully in the coming months and years, it will strengthen Ugandan service delivery at all levels, enhance business competitiveness, accelerate socio-economic transformation, build resilience to shocks, and achieve inclusive and sustainable growth.
She said by promoting inclusive financial systems, the Roadmap can not only increase access to financial services for the poor, but also stimulate economic growth through mobilization of domestic savings and government revenue.

Stories Continues after ad

The giant telecom service provider Airtel Uganda is set to float eight billion of its existing ordinary shares on Uganda Security Exchange (USE).
According to Manoj Murali, the Managing Director of Airtel Uganda, the shares will be listed before the end of this year.
Currently, the government of Uganda is urging telecom operators to list a fifth of their shares on the USE to allow locals to benefit from the sector’s profits.
“We are excited to soon be in a position to share ownership of our business with our fellow Ugandans and outside Uganda. The initial public offer will see up to eight billion existing ordinary shares of the company representing 20% of the company made available,” he said.
Last year, MTN Uganda floated 20% of its shares to Ugandans and East Africans from Tanzania, Burundi, Kenya, Rwanda and South Sudan. The 20% transited into over 4.4M shares.
Each share was sold at Shs 200 and the potential shareholders were required to pay a minimum of Shs 100,000 for them to get 500 shares in the telecom company. MTN International owned 96% of the shares in Uganda but now owns 76% of the company, and the other 4% belong to Mr. Charles Mbiire.
Airtel entered the Uganda Market on June 8 2010 when Bharti Airtel acquired 16 Zain Africa operations.
In 2013, Airtel fully acquired Warid Telecom Uganda in the first ever in-country acquisition in the telecommunications sector. With this, Airtel further consolidated its position as the second largest mobile operator in Uganda with a combined customer base of over 7.4 million and market share of over 39% cementing its position as the second mobile telephone network, behind market leader MTN Uganda.
In 2018, Airtel hit the 10 million customer mark. This milestone cemented Airtel’s position as the fastest growing telecom in Uganda. In January 2019, Airtel Uganda achieved 100% 4G LTE across all its sites in Uganda, translating the national broadband policy into reality. The telecom owns in excess of 2,000 masts in Uganda, as of April 2020.

Stories Continues after ad