By Spy Uganda
dfcu Bank has yet again suffered another catastrophe as its customers reduced in their transactions there by forcing deposits fail to grow. Our inside source intimated to this reporter last night that it has in fact declined by 0.4% i.e from UGX1.987 trillion in 2017 to UGX1.979 trillion in 2018.
Liquidity squeeze also curtailed lending, rendering it grow at a snail speed of a meagre 4% i.e from UGX1.334 trillion 2017 to UGX1.393 trillion in 2018.
Assets also declined by 4.6% from UGX3 trillion to UGX2.88 trillion in stormy 2018, according to reliable sources within the bank.
As a result, dfcu in 2018 experienced a 21% decline in income from UGX519.8 billion to UGX410.6 billion. Net profit nosedived by 51.6% from UGX127.6 billion to UGX61.7 billion
Shareholders are now expected to painfully stomach a 51.6% fall in dividends as the money set aside for dividends reduced by 51.6% from UGX51 billion to UGX24.7 billion.
This is further painful for dfcu shareholders who have seen the value of their shares fall by 28.8% from UGX970 on 17th July 2018 to the current UGX670 by close of business on 27 March 2019.
“As a result, shareholders lost wealth, worth UGX212.9 billion,” said our source.
This meagre performance does not augur well for holders of dfcu stock as it could trigger a further fire sale of existing shares. Sudden supply of dfcu shares on the market could trigger further price cuts.
Investment advisors and brokers, Crested Capital- had earlier warned that the dfcu’s onetime windfall registered in 2017, as a result of Crane Bank’s acquisition would wane and that earnings would normalize to pre-acquisition levels.