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KAMPALA - Absa Bank has reported a growth in revenue by sh64b or 15.6% to sh616b for the period ended December 2023, supported in part by an increase in customer loans and advances. 

In its audited financial results, the bank said the double-digit growth in revenue was largely driven by a 42% growth in transactional banking and trading income. 

Net profits for the period were sh146b compared to sh141 in 2022.

“We continue to see increased customer confidence evidenced by 30% year-on-year increase in customer banking transactions and increased utilization of trade instruments, which grew by 36% year on year. With the resurgence of economic activity, we saw an increased customer uptake of our working capital and trade solutions to meet their business finance need,” Mumba Kalifungwa, managing director, at Absa, said.

Customer deposits grew by 16.3% to sh2.9 trillion, driven by an increase in the active customer base and increased digital and alternate channel utilisation.

Michael Segwaya, chief finance officer at Absa. (All Photos Ali Twaha)

The bank reported a 12.9% growth in customer loans closing 2023 at sh1.76 trillion, reflecting a 10.6% three-year cumulative average growth rate.

“This performance is underpinned by the 5.2% growth in the economy in 2023 amid various macro-economic challenges including underlying inflationary pressures. We disbursed more loans mainly driven by an increased demand by customers for working capital requirements and our trade loans and overdraft utilization yielded 19% and 29% growth respectively,” Michael Segwaya, chief finance officer at Absa, said.

The bank's costs grew by 23.1% largely attributed to investments in staff, and software development among others. As a result, the cost-to-income ratio closed in at 60% compared to sh56% in 2022.

Total assets grew by 7.3% to sh4.5 trillion from sh4.2 trillion.