Commercial banks warn of higher interest rates as BoU hikes lending rate
Commercial banks have said they will increase interest rates following the hiking of the lending rate by the Central Bank. Bank of Uganda has over the past couple of months increased the CBR to 8.5%.
The chief executive officer Stanbic Uganda, Anne Juuko, said the move by the Central Bank is the only solution to inflation, although it undermines growth because the commercial banks are forced to adjust their interest rates upwards.
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Juuko was speaking at the release of the half-year performance results for Stanbic Uganda Holdings Limited, which recorded a profit after tax of Shs 162 billion.
This is up from Shs 158 billion recorded during the same period last year, indicating a 4.7% improvement.
Juuko said the first six months of 2022 presented a complex combination of ‘head’ and ‘tail’ winds that substantially affected both the global and the local economy.
"We resolved to focus on delivering products and solutions that are attuned to these extraordinary times, keeping the customer at the center of all we do, and being relevant in the community in which we serve," she said.
Juuko explained that Stanbic Uganda Holdings managed to deliver acceptable value for both customers and shareholders.
"Our performance reflects targeted positioning for the progressive recovery of the economy, balanced credit risk appetite, prudent cost management and substantive investment in technology for innovation, notably Flexipay," she said.
The introduction of Flexipay was also the basis on which Stanbic recently gained recognition from the widely respected International Banker publication for ‘Best Innovation in Retail Banking Award’.
Andrew Mashanda, from Stanbic Bank said their performance was driven largely by their anchor subsidiary, Stanbic Bank Uganda Limited.
"Our new subsidiaries are continuing to deliver green shoots of hope for our strategic direction, in spite of the challenging operating environment,"
Besides Stanbic Bank, the other subsidiaries of Stanbic Uganda Holdings Limited are: Stanbic Properties, SBG Securities, FlyHub and Stanbic Business Incubator.
