Dfcu Bank well capitalised amidst Legal Challenges – Officials

HABARI DAILY I Kampala, Uganda I In the face of recent legal hurdles, Dfcu Bank remains resolute and well-capitalized, assuring its clients and stakeholders that the court ruling on October 24 will not impact its day-to-day operations.

The ruling directed the bank to vacate 48 leasehold properties that were originally owned by the now-defunct Crane Bank Limited (CBL) within three months. However, Dfcu clarified in a statement released on November 3 that these properties were already vacated more than three years ago in 2020.

“The ruling does not affect the bank’s day-to-day operations since the branches in question were vacated in 2020,” the statement assured.

Moreover, Dfcu emphasized that it is fully indemnified by the Bank of Uganda (BOU) under the Purchase of Assets and Assumption Agreement (P&A), offering additional assurance regarding any financial implications resulting from the legal proceedings.

Crane Bank Limited was closed by BOU in October 2016 due to allegations of being undercapitalized, and its assets were subsequently transferred to Dfcu in 2017. Despite legal challenges from Crane Bank, Dfcu maintains confidence in the indemnity clause, which places the responsibility of any payments or damages related to the premises on BOU.

In a notable display of financial strength, Dfcu Bank, one of the fastest-growing banks in Uganda, reported a substantial profit after tax of sh29.3b for the first half of the year, marking a significant increase from the sh18.8b recorded in the same period last year. 

The bank’s Board of Directors attributed this growth to the group’s financial resilience.

The consolidated half-year report for the period ending June 30 also highlighted the bank’s ability to meet new capital requirements without requiring additional capital infusion from shareholders. 

Despite a 34.83% increase in operating costs, amounting to sh114.8b, compared to sh85.2b in the corresponding period of the previous year, Dfcu managed to enhance its operating efficiencies.

Dfcu Bank’s performance underscores its strong financial foundation and commitment to navigating challenges while ensuring continued growth and stability for its clients and shareholders

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