Dfcu Announces Shs 37Billion Dividend Payout as Assets, Deposits Grow

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Dfcu Bank has on Wednesday released its financial performance report for the year 2020, indicating among others substantial growth in its assets and deposits.

The asset base grew by 18% from Shs. 2,958 billion to Ushs 3,499 billion, upheld by strong growth in liquid assets and loans and advances.

Speaking at the release of the results in Kampala, the bank’s Chief Financial Officer Kate Kiiza revealed that Dfcu Group’s Group’s deposit base also grew by 27% from Ushs 2,039 billion to Ushs 2,595 billion.

She attributed the growth both the newly acquired and existing clients across the business segments.

“Management implemented a clear strategy of growing the liability base, as well as retention of the existing customer relations,” she said.

dfcu Bank Chief Fiance Office – Kate Kiiza addressing the media about the bank’s financial performance in 2020

The shareholders’ funds on the other hand grew by 4% from Ushs 569.7 billion to Ushs 592.9 billion, which she said was a result of increase in retained earnings.

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Owing to this this robust liquidity and healthy capital position, the Dfcu Board has proposed a dividend payout of Shs 37.65 Billion Shillings to shareholders.

That is about Shs 50.33 per share.

The bank however, was impacted by the Covid19 pandemic, leading to a drop in net profit after tax to Ushs 24 billion due to the negative impact of provisions for loans and advances, and impairment of the financial asset.

Mrs Kiiza revealed further that the net loan loss provisions increased by 107% from Ushs 14 billion in 2019 to Ushs 30 billion in 2020.

“The increase in the net loan loss provisions is attributed to the negative impact of Covid-19 on our customers’ business operations,” she said.

“There was also a higher than anticipated impairment charge on the financial asset of Ushs 50 billion in 2020 compared to Ushs10 billion in 2019.”

The company nonetheless remained well capitalized with capital ratios of 19.34% and 20.94% for tier one and two capital respectively.

Liquidity position remained strong with an average liquid assets ratio above 35%.

On his part, Dfcu Managing Director Mathius Katamba expressed optimism as the economy emerges from the crippling Covid19 era.

“As a business, we remain optimistic about a faster recovery of the local economy on account of a successful national vaccine roll out program and a resilient business community,” he said.

“Our future will see continued investment in capabilities that increase convenience for customers in the digital and alternative channels space as well as innovative products and services that improve the efficiency of our services, providing excellent customer experience.”

Source – ChimpReports

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