Barclays records Shs70 billion profit

KAMPALA.

Barclays Bank Uganda has registered a 31 per cent increase in before tax profit which jumped to 70 billion in 2015, from 53 billion in 2014, according to their 2015 financials.
The announcement was made during a media briefing on Tuesday ahead of the release of their financial results today.
The growth in profits was on account of new reforms and strategies which the bank implemented in 2015. One such strategy (deep bank vs wide bank), according to Rakesh Jha, the managing director, helped the bank to create a deeper relationship with their customers.
Despite some challenges, Mr Jha also noted that they had managed to wade through as a bank. “We had challenges with the merger with Nile Bank and we had challenges with technology which we have addressed,” he said.
“2015 was the year we rolled out a few strategies for the business and they have responded very well. We have been able to grow our income from 170 to 2010 billion in 2015, a growth of 20 per cent,” he said.
The cost to income ratio also reduced from 61 per cent in 2014 to 63 per cent in 2015.
This was attributed to the migration of customers from branches into automated and technological channels which has seen the bank cutcosts.
Customer assets also grew by 30 per cent. This growth is important because of the harsh macro-economic environment in 2015, when interest rates were going up.
The operating environment for commercial banks was affected by the weak Shilling which resulted in Bank of Uganda (BoU) raising the benchmark lending rate (CBR) to constrain inflationary pressures.
The CBR was, however, later reduced from 17 to 16 per cent by BoU.
The bank also managed their loan performing ratios which the managing director said were within their budget. The loans went up by 20 per cent against a loan to deposit ratio of 66 per cent to 54 per cent.

Prospects
The bank plans to cut down the number of branches and convert them to digital branches with intelligent ATMs which will reduce dependence of people in these locations.
The digital branches will have all the digital self-service devices which will enable customers to transact more conveniently. The bank will also consolidate some branches in a bid to achieve their digital agenda.
However, “…this does not mean we shall reduce our branch network, but rather shifting our approach to using technology,” Mr Jha explained.

About the bank
Barclays Bank Uganda opened the first branches, at Jinja and Kampala, on 1st August 1927. Employing more than 1,000 people, Barclays Bank Uganda serves more than 350,000 customers and clients across the country through a network of over 40 distribution outlets and 65 ATMs.The bank is regulated by Bank of Uganda.

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