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Absa registers Shs31b profit growth
Absa's growth was also supported by increase in customer loans and deposits transactional activity despite a tough operating environment. Photo / File
What you need to know:
- During the period ended December 2022, Absa reported a 28.9 percent growth in profit after tax to Shs141b up from Shs110b in 2021
A 94 percent reduction in impairment, pushed Absa’s profit margins by Shs31b for the period ended December 2022.
Absa’s profitability was further supported by improvement in the bank’s construction loan book and a 1.4 percent growth in customer deposits to Shs2.4 trillion.
In details contained in the Absa’s financial report, revenues grew by 12.5 percent due to business recovery and improved economic environment, which supported to bank to conducting a distributive lending strategy, registering a 19.8 percent growth in net customer loans to Shs1.5 trillion
During the period, Absa reported a 28.9 percent growth in profit after tax to Shs141b up from Shs110b in 2021 supported by a cumulative annual growth rate of 4 percent for the third year.
While presenting the result in Kampala yesterday, Mr Michael Segwaya, the Absa chief financial officer, said the growth in profits anchors the bank’s position as a leading banking partner for both business and the economy.
“Customer loans grew by 19.8 percent. We continue to support individuals, SME and commercial customers in their personal and business endeavors,” he said, noting that the bank also posted a revenue growth of 12.5 percent to Shs411b underpinned by growth in net interest income of Shs27b and non-interest income of Shs19b.
The growth was also supported by increase in customer loans, deposits transactional activity despite a tough operating environment characterised by increasing interest rates.
Mr Segwaya said during 2022, Absa’s balance sheet was driven by resurgence of the economy and the bank’s continued investment in digital channels.
Loans and advances, he said, grew mainly due to increased demand in credit following the resurgence of the economy from the effects of Covid-19.
“Customers were able to demand credit to support their business and personal needs across the different sectors in the market,” he said.
Customer deposits grew due to increased customer engagement due to the capabilities built by bank across various alternate channels.
Mr Mumba Kalifungwa, the Absa managing mirector, said while the full reopening of the economy gave renewed hope, the bank was faced with the stark reality of conditions brought about by macro-economic factors such as inflationary pressures and high commodity prices, which created an uncertain operating environment.
