The Independent (Kampala)

Uganda: Executive Style - Transforming Into a Commercial Bank

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You are entering a competitive market and yet low access, so how do you intend to you survive in such an environment?

Finance Trust Bank enters the market with a unique value preposition for its customers. We currently have 31 inter-connected branches spread across the country and we are still growing. We have a number of customer centric products that have been developed and more in the pipeline.

We shall rely on innovation to edge out the competition and increase penetration and outreach to the unbanked. On top of the products I have mentioned, we are keeping a good relationship with our clients -business people, agriculturalists, government institutions and agencies, NGOs among others. We are not worried about the competition because we have the experience in this market.

How strong is your capital base as a bank?

Currently, the Bank is highly liquid to meet all our client's funding requirements. Our liquidity ratio is in excess of 45%, which makes us one of the most liquid commercial banks in the market. Our total asset base as at end of November 2013 was in excess of Shs 90 billion. The bank is largely owned by the Uganda Women Trust and other founder members. Other shareholders are RIF II, Progression East Africa Micro Finance, Oikocredit and IPEA.

What is your reading of the future of the financial services industry in Uganda generally?

The future holds a liberal customer who is highly informed about the financing options and with a variety of financial institutions. Branchless banking shall take over and cash transactions are likely to reduce as people embrace electronic money transfer and payment systems such as mobile banking.

The high lending rates in Uganda have been a big issue. How best can banks offer loans at affordable terms but also remain profitable?

Bank interest rates are driven by the cost of funding. Banks can only offer loans on affordable terms only if they can drive their cost of funding lower. This involves sourcing for cheap deposits and increasing efficiency to cut out unnecessary processes that turn out to make credit more expensive.

Where do you want to see Finance Trust Bank in in the next five years?

We want Finance Trust Bank to be the most-preferred and most-affordable micro finance bank in Uganda in the next five years.

Finally, taking an institution of this stature through a major transition like this one is not an easy task. How are you managing the situation?

Well, Finance Trust Bank has a team of young and innovative staff that has been very instrumental in the transformation process. I intend to continue relying on this very competent team to deliver value for our customers and ensuring sustainability.

We are proud to be the first indigenous institution to successfully transform from an MDI to a commercial bank. This definitely provides a big opportunity to our customers to grow with us.

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