UDB registers loan portfolio growth 

Uganda Development Bank (UDB), the country’s national Development Finance Institution (DFI), registered a 52 per cent gross loan portfolio growth from Shs 851 billion in December 2021 to Shs 1,298 billion in December 2022.

This was disclosed by the bank’s director of Strategy, Joshua Mwesigwa during their annual press briefing held in Hoima. He described 2022 as an exceptional year for UDB scoring exceedingly against their set targets in their endeavour to propel strong economic recovery.

The bank also indicated that the value of new loan applications approved to receive funding grew by 40 per cent against the 2021 performance, registering a total of Shs 894 billion from the Shs 635 billion registered in 2021 with the industry sector comprising of manufacturing and agro industry receiving the highest number of approvals worth Shs 454.75 billion and primary agriculture receiving Shs 96.75 billion.

“The approved ex-ante projections indicate that the 249 projects will create a total of 35,372 new direct jobs and Shs 9.3 trillion worth of output value/turnover from the businesses financed. These are further expected to generate Shs 393.79 billion in tax revenue to the government and attract foreign exchange earnings equivalent to Shs 1.58 trillion,” Mwesigwa said.

According to Mwesigwa, the bank’s total assets currently stand at Shs 1.44 trillion, growing by 19 per cent from Shs 1.21 trillion at the start of 2022. This growth is mainly on account of capital allocations from government and draw down of lines of credit from various other funding partners.

Meanwhile, the bank disbursed a total of Shs 776.6 billion during the year 2022, improving by 81 per cent from Shs 428 billion disbursed the previous year. Of this sum, 76 per cent was disbursed to projects engaged in agriculture, agro-processing and manufacturing.

“Uganda has lived through major socio- economic shocks in the last three years, including Covid-19, adverse climate and the impacts from geopolitical shocks and our role as a development finance institution has been to support the revitalization, transformation and resilience of our economy against these shocks through supporting the private sector,” said Mwesigwa.

He noted that through UDB’s product and services portfolio, they have been able to promote and develop key growth and priority sectors of the economy including agriculture, (both primary and agro-processing), manufacturing, tourism and targeted interventions to support infrastructure and Human Capital Development (education and health).

In 2022, the bank launched the Special Programs intervention, which has effectively implemented several strategies with a focus on channeling interventions to promote small and medium-sized firms (SMEs) as well as businesses run by women and youth within the bank’s supported sectors.

After a year of implementation, the bank approved more than Shs 31.5 billion with 128 enterprises including 42 women-owned benefitting from this program.

To further support these businesses, the bank further launched the Business Accelerator for Successful Entrepreneurship (BASE) aimed at preparing entrepreneurs for financing through enhanced business practices.

“In 2022 alone, eight regional training sessions targeting 1,130 SMEs were conducted in Kampala, Mbarara, Fort Portal, Lira, Gulu, Arua, Masaka, and Mbale districts. As a result of these sessions, the bank identified funding prospects amounting to Shs 147.3 billion. Additionally, 77 hitherto informal enterprises undertook various business formalization processes with 45 registering their business names and 37 others formally registering as new taxpayers or for tax certification,“ Mwesigwa noted.

Conversely, the bank has earmarked 274 enterprises to participate in the inaugural UDB Business Incubation Program to be held this year, the aim of which is to facilitate the incubatees to be credit-ready and potentially prospective customers of UDB.

jjingoernest1@gmail.com