dfcu Bank reports impressive 45% profit surge in first half of 2024

dfcu Bank has announced a remarkable financial performance for the first half of the fiscal year 2024, with a 45% increase in net profit after tax, reaching UGX 42 billion in June 2024, up from UGX 29 billion in June 2023.

This significant growth released in a press statement is driven by a combination of factors, including a substantial reduction in credit losses from loans and advances.

The bank said this is a strategic decrease in interest expenses, and an uptick in fees and commissions due to an increase in transacting customers.

“The bank’s half-year results showcase a UGX 13.6 billion increase in profit compared to the full year 2023, representing a 48% year-on-year growth.” Said in a statement.

Notably, net loan loss provisions saw a dramatic decrease, shifting from a loss of UGX 50 billion in June 2023 to a credit of UGX 6 billion in June 2024.

This turnaround is attributed to management’s efforts to reduce non-performing loans, diversify the portfolio, and lower concentration risk, resulting in a drop in the non-performing loans ratio from 15.2% to 5.2% over the same period.

“Additionally, dfcu Bank’s asset base grew by UGX 6.5 billion, primarily driven by a 4% increase in investment in government securities, reflecting the bank’s cautious approach to credit risk in the first half of the year.” It added.

The deposit base remained stable at UGX 2,319 billion as of June 2024, while shareholders’ funds rose by 6% to UGX 684 billion, fueled by an increase in retained earnings.

With strong capital ratios of 29% for core capital and 30% for total capital, alongside a robust liquidity position with an average liquid assets ratio above 40%, dfcu Bank is well-positioned for future growth and enhanced financial performance.

Management remains optimistic about the bank’s trajectory, given its solid financial foundation and strategic initiatives.