Barclays bank profits up by 30%
“Because of the macroeconomic headwinds that the economy experienced in 2015, a 20% increase in our income levels was im ...
Barclays bank Uganda's profits for the financial year ended December 31st, 2015 have increased by approximately 30% from sh41b in 2014 to sh53b in 2015, according to company figures.
While addressing journalists at the bank's head office in Kampala on Tuesday, Rakesh Jha, Barclays bank managing director, said that 2015 was characterized by many challenges for the banking sector like increase in the central bank rates that rose by over 50% from 11% in January to 17% in December 2015.
This led to subsequent increase in the commercial banks' lending rates, something that affected loan uptake by customers.
Jha also said that there was also a liquidity crunch in the market as a result of currency depreciation as the Ugandan currency lost its value by 17.5% throughout 2015, which led to a decline in deposits
He explained that despite the challenges that affected the sector, the bank's income grew by 20% from sh174b in 2014 to sh210b in 2015.
"Because of the macroeconomic headwinds that the economy experienced in 2015, a 20% increase in our income levels was impressive for us as a bank," he said.
Growth in profit after tax was also driven by efficient management of other aspects like costs and leveraging on technology.
"There was also leveraging on technology where a total of 17 intelligent Automatic teller machines (ATMs) that allow cash, cheque deposits and payment transactions to be carried out at the machine partly contributed to efficient cost management," he said.
Customer deposits on the other hand grew by 8% driven by improvements in our relationships with them. Uganda's transaction growth rates have been the highest in Africa and our number of transactions is the second highest in Africa.
2015 was the first year when we rolled out some of our strategies like creating deeper relations with customers and this greatly contributed to increase in customers deposits by the 8% margin.
Big plan for agriculture
Jha decried the mismatch between population engagement in the agricultural sector and its contribution to Gross Domestic Product (GDP). He said that population engagement in the sector both directly and indirectly is over 70% yet sector contribution to GDP is estimated to be 25%.
We want to create partnerships with Non-Governmental Organisations, cooperatives, intermediaries and technical people in the sector to ensure that the population understands better understands post-harvest handling, packaging, processing and value addition in order to increase sector's productivity and contribution to GDP.