The Independent Uganda: You get the Truth we Pay the Price
The Bank’s investment portfolio improve 15% to Shs1.8tn
| THE INDEPENDENT | Uganda Development Bank Ltd (UDB) has reported that it disbursed loans worth Shs237bn in the third quarter of 2022, lower than Shs333bn that was approved in the period under review, it said in a media release dated Oct.28.
According to Patricia Ojangole, UDB’s managing director, the funding was allocated to 72 projects across the country and operating within UDB’s priority sectors.
In line with its strategy, the bulk (80%) of these approvals were towards projects engaged in primary agriculture (Shs83billion); agro-processing (Shs48 billion) and manufacturing (Shs180billion).
Other sectors/services (including infrastructure, tourism, and human capital development) accounted for 30% of the disbursements (Shs70billion in value).
The total disbursements for January to September amounted to Shs556billion, more than doubling the Shs273billion deployed during the same period in 2021.
“Our financial results for the third quarter of 2022 are highlighting solid growth as we continue to facilitate economic recovery through tailored interventions that suit the country’s development needs,”Ojangole said.
Through third quarter, which covered the months of July, August, and September, UDB’s investment portfolio (gross loans) improved by 15% to close at Sh1.18trillion. Compared to the previous year, the annual growth registered was in the highs of 57%.
Ojangole said, the investments approved in the third quarter improved the Bank’s 2022 approvals (since January 2022), to Shs797billion, registering a 66% increase versus the Shs479 billion approved in the same period last year.
“The Bank continues to avail the much-needed liquidity of funds to boost the capacity and resilience of private enterprises,” she said.
Under its specialized intervention fund dubbed the “UDB Special Programs” that directly targets support to the small and medium enterprises), youth, and women-owned enterprises, the Bank approved funding amounting to Shs7.1billion during the third quarter, bringing the total approvals in 2022 to Shs20.2billion to support 91 enterprises.
“The Bank will continue to focus on these segments to holistically address the issues that systemically challenge their access to credit, including but not limited to building enterprise capacity,” Ojangole said.
Job, other opportunities
The projects approved for funding are projected to generate various development outcomes, including 33,060 jobs. Upon full implementation, these projects are also expected to generate additional output value of Shs8.9 trillion, from which Shs365 billion in taxes will be paid to the government.
Meanwhile, under its Business Accelerator for Successful Entrepreneurship (BASE) intervention, the Bank in the third quarter implemented an Enterprise Development Program across the various regions of the country.
Conducted in partnership with government agencies including the Uganda Revenue Authority, National Social Security Fund, Uganda Registration Services Bureau, and Uganda National Bureau of Standards, the training sessions aimed to support nascent SMEs on their journey to professionalize their operations, their formalization and building their capacity to be credit ready.
The regional sessions targeting 1,130 SMEs, were conducted in Kampala, Mbarara, Fort Portal, Lira, Gulu, Arua, Masaka and Mbale districts.
In terms of financial performance, during the period under review, the Bank’s total assets amounted to Shs1.44 trillion, growing by 19% from Shs1.21trillion at the start of the year.
The growth in the assets and loan book is on account of sustained growth in funding over the recent past both from government capitalization and draw down of lines of credit from bilateral and multilateral funders.
“The Bank remains a sustainable institution, generating adequate resources to sustain its operations and meet its financial obligations. During the third quarter, the Bank received Shs26.65billion from the FY2022/23 Government of Uganda budgetary allocation, increasing the capital receipts in 2022 to Shs86.1billion.
Going forward, Ojangole said, to match the ever-growing demand for long-term (patient) and affordable capital, a key ingredient for sustained economic growth, the Bank is deploying various mechanisms to diversify its funding base, and to complement the capital allocations from the Government of Uganda.
“The Bank remains committed to making a meaningful contribution to improving the quality of life of Ugandans,” said Ojangole.
Key facts
- 33,060 jobs created and maintained
- UDB’s investment portfolio now at Shs1.18 trillion
- 1billion released to SMEs
- Shs237bn disbursed in the third quarter of 2022, lower than Shs333bn approved amount
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