Dfcu Bank has said it will rely on seven core strategies to revitalise profitability.
Speaking at the 57th virtual annual general meeting in Kampala on Wednesday,, Mr Mathias Katamba, the dfcu Bank managing director, said the bank will diversify its financial streams in the coming years to include retail personal, retail business and corporate banking.
The move, he said, seeks to ensure that the bank’s recovery is effective to drive profitability.
“We are diversifying through retail personal, retail business and corporate banking to meet financial needs of our customers and improve our profitability,” he said.
During the period ended December 2021, dfcu’s net profits dropped by 46 percent to Shs13. 2b due to the increase in non-performing loans.
However, interest income grew by 3 percent, translating to Shs11.8b while net income grew by 21 percent. Interest expense reduced by 26 percent or Shs29b while operating expenses dropped 4.2 percent or Shs8.1b.
Mr Katamba said focus will be put on improving management of the business through credit risk and cost management to further reduce operation cost while increasing investment in technology.
“About 76 percent of our payments were done by digital means in 2021 and we took deliberate strategy to shed or replace expensive fixed deposits as part of wider efforts to bring down funding cost,” he said, noting they will adopt a sustained reduction in costs through using alternative channels.
Responding to shareholders’ inquiries on why they had not been paid dividend even after the Central Bank lifted a ban on the discretionary payments, the dfcu general manager George Ochom said dividend basically comes from the bank’s profits, which were during 2021 adversely affected by Covid-19.