The Independent Uganda: You get the Truth we Pay the Price
The lender’s blend of loan growth, fee income, community outreach and cautious risk-taking offers a model others may struggle to emulate
Kampala, Uganda | THE INDEPENDENT | Uganda’s biggest bank is in rude health. Stanbic Uganda Holdings reported a profit of Shs 278 billion for the first half of 2025, up 18% on the year. That gives it a return on equity of 27%, well above the group’s 20% target. In an industry often buffeted by volatile currencies, policy shifts and fickle credit cycles, Stanbic’s numbers suggest unusual calm.
The foundations are solid. Its loan book expanded by 12.9% to Shs 4.9 trillion, supported by customer deposits swelling nearly 29% to Shs 8.4 trillion. Net interest income nudged higher to Shs 371.5 billion. Yet the real story lies outside the margins on loans. Non-interest revenue climbed 14% to Shs 313.7 billion, buoyed by fee income and a lively trading desk, which pushed net trading gains up to Shs 188.2 billion.
The bank has also learned to keep costs in check. Its cost-to-income ratio remains below 50%. Credit losses are negligible, at just 0.2%. Such frugality allowed management to propose an interim dividend of UShs 140 billion (2.73 shillings a share), a generous gesture in a market where investors have grown accustomed to modest payouts.
Shs 273 billion in taxes
Beyond the spreadsheets lies Stanbic’s economic clout. The bank paid Shs 273 billion in taxes during the period, 37% more than last year, while channelling another Shs 5.8 trillion to the Uganda Revenue Authority on behalf of clients. It is, in effect, one of the government’s more reliable fiscal engines.
Lending is spreading, too. Loans to small and medium-sized enterprises reached UShs 968 billion, while agriculture received Shs 398 billion, including Shs 65 billion channelled through farmer cooperatives. These sectors are where Uganda’s growth is most labour-intensive, and Stanbic’s capital may be as important as the government’s rhetoric about inclusive growth.
Its investment arm is also on the march. Assets under management leapt more than threefold to Shs 216 billion. A surge of retail investors, whose unit trust numbers rose by 320%, reflects a small but telling shift: Ugandans are beginning to warm to investment products rather than relying solely on land, bricks and bank deposits.
Community investments
The bank has also sought to cement goodwill in the communities it serves. Through financial literacy drives, youth and women entrepreneurship schemes, and partnerships with schools and farmer cooperatives, it is investing in the social capital that will produce tomorrow’s borrowers and savers. Such initiatives may burnish its brand, but they also extend the reach of the financial system into parts of Uganda that the formal economy has long overlooked.
Stanbic Bank Chief Executive, Mumba Kalifungwa, said while their strong financial performance reflects their market leadership and resilience, it is the real, measurable impact on communities and sectors that defines their role as a catalyst for sustainable economic transformation.
The macroeconomic backdrop is encouraging. Growth in the first half of the year was estimated at 6.5%, inflation has eased to 5.4%, and foreign direct investment nudged up to $1.5 billion.
Stanbic’s chief executive, Francis Karuhanga, boasts that the group’s strategy is “aligned with Uganda’s long-term development goals.” He has a point: in a country with 46m people, nearly four-fifths of them under 35, the need for finance, housing and jobs will remain pressing for decades.
Yet there are caveats. Oversupply threatens to drag on parts of the property market, as per the latest market report by the country’s leading property management firm, Knight Frank, in which the occupancy rates across offices, residential apartments, and retail malls have softened.
Competition among banks is stiffening, especially in digital services. Global uncertainties, from commodity price swings to donor belt-tightening, may dent corporate clients’ appetite for credit. Stanbic’s enviably low impairments could creep up.
For now, though, the bank looks like a bellwether for Uganda’s economic confidence. Its blend of loan growth, fee income, community outreach and cautious risk-taking offers a model others may struggle to emulate. If Uganda’s economy continues to expand, Stanbic’s balance sheet will grow with it. And if turbulence returns, the first half of 2025 suggests the lender has built up enough ballast to ride it out.
