UDB board approves Shs 63bln in recapitalisation as 2025 profit jumps 9.7 percent

KAMPALA, August 17, 2026 — The Uganda Development Bank [UDB] board has approved Shs 63 billion in recapitalisation following the disbursement of at least Shs 502.2bln to facilitate private sector growth.

The bank also recorded a positive profit trend, posting a 9.7 percent rise in profit in the financial year 2025/2026, while its total assets grew by 27 percent to Shs 2.26 trillion.

The government-owned lender’s net loans and advances also rose by 6.6 percent to Shs 1.63trn, while enterprises supported by the institution created and sustained a total of 69,202 jobs, representing a 24.6 percent increase.

The board’s decision will enable the institution to strengthen its lending capacity following the lender’s strong 2025 earnings and a 165 percent increase in share capital to Shs 5trn.

This follows a year of strong financial performance in which the development finance institution posted a profit after tax of Shs 63.4bln for the year ended December 2025, representing a 9.7 percent increase over 2024.

The results were presented at UDB’s Annual General Meeting [AGM] held at the Ministry of Finance last week.

The recapitalisation is expected to give the bank greater capacity to finance large-scale investments in sectors considered critical to Uganda’s economic transformation.

UDB Managing Director Dr Patricia Ojangole said the bank’s performance confirmed the role of development finance in supporting investments that may not be adequately served by conventional commercial lending.

“Development finance delivers its greatest value when it unlocks opportunities that commercial markets alone cannot provide,” Ojangole said.

She said UDB’s investments were intended to strengthen productive enterprises, create jobs, expand value addition and improve incomes.

UDB’s total assets grew by 27 percent to Shs 2.26trn in 2025, from Shs 1.78 trillion a year earlier, while total equity rose by 24.8 percent to Shs 1.89trn.

Net loans and advances increased by about 7 percent to Shs 1.63trn, reflecting continued expansion of UDB’s financing to productive sectors.

UDB’s loans to the private sector

UDB approved Shs 518.4bln in new financing for 120 projects during the year and disbursed at least Shs 502.2bln, a 29 percent increase from 2024.

Virtually two-thirds of its financing went to agriculture, agro-industrialisation and manufacturing, sectors considered critical to raising productivity, expanding value addition and reducing reliance on imported manufactured goods.

The bank’s active customer base increased to 689 enterprises operating across 105 districts around the country.

Enterprises supported by UDB created and sustained at least 69,202 jobs during the year, a 24.6 percent increase and one of the strongest annual employment impacts recorded by the bank.

The enterprises generated production worth about Shs 6.26trn and profits exceeding Shs 1.16trn.

The enterprises’ tax contributions rose by 22.5 percent to Shs 387bln, while foreign exchange earnings increased from the equivalent of Shs 1.11trn to Shs 1.84trn.

Speaking at the AGM, Finance Minister Henry Musasizi said the government’s priority was now to make development finance cheaper and more accessible to businesses.

“Our target was to bring UDB’s lending rate down from the current 12 percent to single digits, while shortening loan approval times and expanding the range of eligible borrowers, including small and medium enterprises,” Musasizi said.

He also revealed that the government intends to mobilise additional resources for the bank, including external borrowing backed by government guarantees.

“Our aim is to have a strong bank that is able to provide cheap credit to investors in big projects in manufacturing, agro-industrialisation, hotels and tourism, among others,” Musasizi said.

The bank strengthened its funding base through partnerships with bilateral and multilateral development institutions and launched the Reshaping Industry for Sustainable Economy [RISE] initiative to turn development challenges into investment-ready projects.

UDB’s performance comes against a favourable macroeconomic backdrop, with Uganda’s economy growing by 6.3 percent in 2025 while inflation declined to 3.3 percent.

https://thecooperator.news/udb-urged-to-prioritise-funding-for-countrys-key-growth-sectors/

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