Absa Bank Uganda sees 28% jump in full-year earnings

Absa Bank Uganda, a leading financial institution in the country, has reported a remarkable 28% increase in its trading results, signaling a positive outlook for both the bank and the Ugandan economy. In an exclusive interview with CNBC Africa, Managing Director Mumba Kalifungwa shared insights on the bank's expansion plans and the impact of macroeconomic factors on their operations. Despite facing challenges such as global supply chain disruptions, rising interest rates, and monetary policy interventions, Absa Bank Uganda remains committed to providing innovative solutions for its clients. Kalifungwa emphasized the importance of focusing on growth-centered strategies to drive the bank's performance in the ever-changing economic landscape. One of the key points highlighted by Kalifungwa was the bank's commitment to enhancing the digital experience for customers and strengthening client relationship management. By prioritizing these areas, Absa Bank Uganda aims to continue growing its presence in the local banking sector and contribute to the overall development of the Ugandan economy. With the Ugandan economy expected to grow by 5% to 6% in the 2023-2024 financial year, fueled by increased activity in sectors such as oil and gas, the bank is optimistic about the recovery in industries like manufacturing and services. Kalifungwa reiterated the bank's focus on sector-led strategies and innovative solutions to support client growth and working capital needs. Moreover, Kalifungwa acknowledged the challenges posed by external factors such as the ongoing global conflicts and the impact of COVID-19 on businesses. Despite the supply chain disruptions and margin compression experienced in 2022, Absa Bank Uganda proactively engaged with clients to navigate these challenges. The bank's business support and recoveries unit played a crucial role in assisting clients with financial distress and developing strategies to enhance operational efficiencies. Looking ahead to the 2023-2024 fiscal year, Kalifungwa emphasized the importance of collaboration with clients to anticipate and mitigate the impact of external uncertainties on their businesses. In response to the IMF's revised World Economic Outlook, which lowered the growth projection for Africa from 3.9% to 3.6%, Kalifungwa maintained a cautiously optimistic view. While recognizing the uncertainties in the global economic landscape, including supply chain disruptions and inflationary pressures, Absa Bank Uganda remains focused on executing its strategic initiatives to navigate these challenges effectively. Kalifungwa highlighted the resilience of the Ugandan economy in surpassing Sub-Saharan and global growth rates in recent years, indicating a positive trajectory for the country's economic prospects. In conclusion, Absa Bank Uganda's strong financial performance and strategic resilience position it well to capitalize on growth opportunities amidst evolving economic challenges. With a client-centric approach and a focus on innovation, the bank is poised to continue driving its business forward and contributing to the growth and development of the Ugandan economy.