Bank lends out Shs 691 billion to 201 Projects Nationwide
BY LUCAS MUSISI
On February 29th, 2024, in Mubende, Uganda, the Uganda Development Bank (UDB) revealed substantial growth metrics for the year 2023, showcasing a robust expansion in gross loan disbursements and total assets, alongside the initiation of new programs aimed at bolstering private sector endeavors. Over the course of 2023, UDB sanctioned funding totaling UGX691 billion to underpin 201 projects nationwide.
The institution’s unaudited 2023 results disclosed an 8% surge in assets, escalating from UGX1.52 trillion in 2022 to UGX1.64 trillion in the preceding year. This uptick was propelled chiefly by a 24% augmentation in gross loans to customers, reaching UGX1.6 trillion by the close of the period.
Patricia Ojangole, the Managing Director of UDB, articulated the institution’s performance, emphasizing its alignment with overarching strategic objectives and developmental imperatives. Ojangole underscored the institution’s unwavering dedication to fostering tangible socio-economic progress while ensuring financial sustainability.
“I am happy to report that both capitalization and funding towards the bank grew, meaning we were enabled by the government to realize our strategic goals. The bank’s funds inched up year-on-year by 12 percent, from UGX1.23 trillion to UGX1.38 trillion, attributed to capital injections by the government during the period and retained and reinvested profits from the prior years, with these sources complemented by additional funding from funding partners. We continue to explore all options to improve our funding base to reach more enterprises, thereby expanding our impact,” said Ms. Ojangole.
The report further presented a modest 5 percent increase in borrowing and grants, climbing from UGX232 billion in December 2022 to UGX245 billion. Notably, UGX466.5 billion in loan repayments were collected and reinvested, facilitating continuous support to various enterprises.
Aligned with UDB’s strategic thrust, a significant portion of approved funding, accounting for 59 percent, targeted the industry sector, with UGX409 billion earmarked for agro-industrialization and manufacturing endeavors. Additionally, UGX19 billion was allocated to primary agriculture, while UGX223 billion was earmarked for infrastructure enhancement.
In tandem with funding approvals, UDB disbursed UGX610 billion to diverse projects in 2023, with the lion’s share directed towards the industry sector, constituting 65 percent of total disbursements. This strategic allocation aimed to bolster economic diversification and infrastructure development.
Beyond financial metrics, UDB’s initiatives are projected to yield substantial socio-economic benefits, including the creation of 18,558 jobs, UGX 11.39 trillion in additional output value, UGX 615.96 billion in tax revenue, and UGX 3.3 trillion in foreign revenue earnings.
To address the needs of underserved segments, including SMEs, youth, and women, UDB implemented tailored programs, allocating UGX22 billion to support 118 enterprises and disbursing an additional UGX17 billion. Noteworthy investments were made in innovative startups through the Private Equity and Venture Capital portfolio, catering to entities requiring patient capital.
In light of Uganda’s entrepreneurial landscape, UDB’s interventions extend beyond financial support to encompass capacity building and mentorship. Initiatives such as the Business Accelerator for Successful Entrepreneurship (BASE) program provided training to over 500 enterprises, with a focus on agricultural ventures.
Looking ahead, UDB aims to consolidate its gains and bolster its support for private sector enterprises, underpinned by a commitment to enhancing the quality of life for Ugandans. With a focus on expansion and efficiency, the institution plans to establish regional offices across the country, thereby deepening its impact and fostering financial inclusion.
