<ul><li>Small and Medium Enterprises Financing  </li></ul><ul><li>Development Finance Company of Uganda-(DFCU) Model </li>...
Presentation Outline <ul><ul><li>Location of Uganda </li></ul></ul><ul><ul><li>Uganda Economic Indicators </li></ul></ul><...
AFRICA-EAST AFRICA-UGANDA Tanzania Kenya Uganda Indian Ocean Europe Red Sea Med. Sea Atlantic Ocean Asia Africa
Uganda Economy 2005/6 <ul><li>Economy based on agriculture–Coffee, Cotton, Fish, Horticulture, Tourism etc. </li></ul><ul>...
<ul><ul><li>Bank of Uganda – Central Bank-Regulator </li></ul></ul><ul><ul><li>Commercial Banks – 15 </li></ul></ul><ul><u...
<ul><ul><li>Commercial Banks  </li></ul></ul><ul><ul><li>Foreign Assets = U.shs. 570.6bn </li></ul></ul><ul><ul><li>Net do...
Who we are <ul><ul><li>Established  1964 </li></ul></ul><ul><ul><li>Shareholders Include:  </li></ul></ul><ul><ul><li>CDC ...
Commercial  Banking Services <ul><ul><li>Personal/Retail Banking </li></ul></ul><ul><ul><li>Business Banking </li></ul></u...
Development  Finance Services <ul><ul><li>Leasing </li></ul></ul><ul><ul><li>Long Term Finance </li></ul></ul><ul><ul><li>...
Products and Services <ul><ul><li>Leasing Commercial Banking </li></ul></ul><ul><ul><li>700 accounts – Portfolio shs.39bn ...
Financial Highlights Dividend in 2005 is 40%  of UGX 13.2 bn= UGX 5.2 bn (US $ 2.8m)
Domestic Resource Mobilisation   <ul><ul><li>Local Currency; </li></ul></ul><ul><ul><li>Deposit from Customers for the Com...
Foreign Resource Mobilisation   <ul><li>Foreign Currency; </li></ul><ul><ul><li>Line of Credit </li></ul></ul><ul><ul><li>...
Foreign Sources of Funds   <ul><ul><li>PROPARCO-France </li></ul></ul><ul><ul><li>IFC </li></ul></ul><ul><ul><li>European ...
Funding Challenges  <ul><ul><li>High cost of funds  </li></ul></ul><ul><ul><li>Currency Restrictions </li></ul></ul><ul><u...
Funding Model <ul><ul><li>Commercial Banking services </li></ul></ul><ul><ul><li>Development Finance services </li></ul></...
Sources of Technical Assistance <ul><ul><li>IFC/WORLD BANK </li></ul></ul><ul><ul><li>European Investment Bank </li></ul><...
Moses K. Kibirige [email_address] Kampala - Uganda Thank youk Thank you
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Mr. Moses Kibirige,

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Mr. Moses Kibirige,

  1. 1. <ul><li>Small and Medium Enterprises Financing </li></ul><ul><li>Development Finance Company of Uganda-(DFCU) Model </li></ul><ul><li>Moses K.Kibirige </li></ul><ul><li>Executive Director DFCU Ltd.-Uganda </li></ul><ul><li>June 27 th . – 28 th . – Paris - France </li></ul>
  2. 2. Presentation Outline <ul><ul><li>Location of Uganda </li></ul></ul><ul><ul><li>Uganda Economic Indicators </li></ul></ul><ul><ul><li>Uganda Financial Sector </li></ul></ul><ul><ul><li>Uganda Financial Sector Activities </li></ul></ul><ul><ul><li>Commercial Banking Services </li></ul></ul><ul><ul><li>Development Finance </li></ul></ul><ul><ul><li>Products and Services </li></ul></ul><ul><ul><li>Domestic Resource Mobilisation </li></ul></ul><ul><ul><li>Foreign Resource Mobilisation </li></ul></ul><ul><ul><li>Foreign Sources of Funds </li></ul></ul><ul><ul><li>Funding Challenges </li></ul></ul><ul><ul><li>Funding Model </li></ul></ul><ul><ul><li>Source of Technical Assistance </li></ul></ul>DFCU Headquarters
  3. 3. AFRICA-EAST AFRICA-UGANDA Tanzania Kenya Uganda Indian Ocean Europe Red Sea Med. Sea Atlantic Ocean Asia Africa
  4. 4. Uganda Economy 2005/6 <ul><li>Economy based on agriculture–Coffee, Cotton, Fish, Horticulture, Tourism etc. </li></ul><ul><li>GDP = US $ 8.5bn with a growth of about 5.3%. </li></ul><ul><li>Per capita income = US $ 250 </li></ul><ul><li>Population = 27m </li></ul><ul><li>External debt = US $ 4.9bn </li></ul><ul><li>Inflation = Average 5.3% </li></ul><ul><li>Land locked country </li></ul>
  5. 5. <ul><ul><li>Bank of Uganda – Central Bank-Regulator </li></ul></ul><ul><ul><li>Commercial Banks – 15 </li></ul></ul><ul><ul><li>(Dfcu Group is 4 th . Largest) </li></ul></ul><ul><ul><li>Insurance companies - 16 </li></ul></ul><ul><ul><li>Forex Bureau - 62 </li></ul></ul><ul><ul><li>Non-Banking Credit Financial Institutions -7 </li></ul></ul><ul><ul><li>Development banks -3 </li></ul></ul><ul><ul><li>Microfinance Institutions – 20 </li></ul></ul><ul><ul><li>Villages banks/SACCOs </li></ul></ul><ul><ul><li>Capital Markets Authority (CMA) – 1996 - Regulator </li></ul></ul><ul><ul><li>Uganda Securities Exchange (USE) – Stock Exchange </li></ul></ul>Uganda - Financial Sector
  6. 6. <ul><ul><li>Commercial Banks </li></ul></ul><ul><ul><li>Foreign Assets = U.shs. 570.6bn </li></ul></ul><ul><ul><li>Net domestic Assets = U.shs. 1999.5bn </li></ul></ul><ul><ul><li>Deposits = U.shs.2,212bn </li></ul></ul><ul><ul><li>Capital Markets </li></ul></ul><ul><ul><li>Market capitalisation of USE was US $ 1,408 </li></ul></ul><ul><ul><li>DFCU listed in 2004 and it is valued at US $ 67m. </li></ul></ul><ul><ul><li>There are 6 listed companies </li></ul></ul><ul><ul><li>Insurance Services – Modest growth </li></ul></ul><ul><ul><li>Pension sector – Source of long term investment – To be liberalised </li></ul></ul><ul><ul><li>Microfinance services – Availability and outreach limited </li></ul></ul><ul><ul><li>Mortgage – There are two mortgage institutions including DFCU </li></ul></ul><ul><ul><li>Leasing – there are three main institutions including DFCU </li></ul></ul><ul><ul><li>Treasury bill rate 91 days = 8% </li></ul></ul><ul><ul><li>Interest rates – 12% to 30% for shs. And 8% to 12% for US $ </li></ul></ul><ul><ul><li>Exchange rate – 1 US $ 1850 </li></ul></ul>Uganda - Financial Sector-Activities 2005
  7. 7. Who we are <ul><ul><li>Established 1964 </li></ul></ul><ul><ul><li>Shareholders Include: </li></ul></ul><ul><ul><li>CDC (60%) - Britain </li></ul></ul><ul><ul><li>Norfund (10%) - Norway </li></ul></ul><ul><ul><li>NSSF (11%) – Uganda’s Pension Fund </li></ul></ul><ul><ul><li>4,000 other Private & Institutional Shareholders (19%) </li></ul></ul><ul><ul><li>Listed on the Uganda Securities Exchange, </li></ul></ul><ul><ul><li>October 14 th , 2004. </li></ul></ul><ul><ul><li>Sound, reputable shareholders, good brand, sound track record and respected </li></ul></ul><ul><ul><li>Share price at listing shs.230/= October 2004 </li></ul></ul><ul><ul><li>Share price currently shs.505/= June 2006 </li></ul></ul>dfcu Group Development Finance dfcu Bank Leasing Mortgages Term Finance Commercial Banking
  8. 8. Commercial Banking Services <ul><ul><li>Personal/Retail Banking </li></ul></ul><ul><ul><li>Business Banking </li></ul></ul><ul><ul><li>Wholesale Banking </li></ul></ul><ul><ul><li>ATMs </li></ul></ul>
  9. 9. Development Finance Services <ul><ul><li>Leasing </li></ul></ul><ul><ul><li>Long Term Finance </li></ul></ul><ul><ul><li>Mortgage </li></ul></ul><ul><ul><li>Microfinance </li></ul></ul>
  10. 10. Products and Services <ul><ul><li>Leasing Commercial Banking </li></ul></ul><ul><ul><li>700 accounts – Portfolio shs.39bn (US$ 21m) Portfolio shs.99bn (US $54m) </li></ul></ul><ul><ul><li>26,158 accounts </li></ul></ul><ul><ul><li>Personal/Retail </li></ul></ul><ul><ul><li>Mortgage Business Banking </li></ul></ul><ul><ul><li>500 accounts-Portfolio shs.39bn (US $ 21m) Wholesale Banking </li></ul></ul><ul><ul><li>Term Finance </li></ul></ul><ul><ul><li>200 accounts-Portfolio shs.72bn (US $ 38m) </li></ul></ul><ul><ul><li>TOTAL PORTFOLIO SHS. 249 bn (US $ 134m) </li></ul></ul><ul><ul><li>DFCU is the only single Financial Institution in Uganda that </li></ul></ul><ul><ul><li>provides a range of financial services under one roof </li></ul></ul>
  11. 11. Financial Highlights Dividend in 2005 is 40% of UGX 13.2 bn= UGX 5.2 bn (US $ 2.8m)
  12. 12. Domestic Resource Mobilisation <ul><ul><li>Local Currency; </li></ul></ul><ul><ul><li>Deposit from Customers for the Commercial bank </li></ul></ul><ul><ul><li>Equity </li></ul></ul><ul><ul><li>Local Commercial Banks – Borrowing </li></ul></ul><ul><ul><li>Foreign sources in local currency – EIB, Norfund </li></ul></ul><ul><ul><li>Stock Market – Bonds </li></ul></ul><ul><ul><li>Guarantees </li></ul></ul><ul><ul><li>Pension fund – Borrowing </li></ul></ul><ul><ul><li>Insurance Companies – Borrowing </li></ul></ul><ul><ul><li>Securitisation </li></ul></ul><ul><ul><li>Government funds </li></ul></ul><ul><ul><li>Government – conducive environment </li></ul></ul>
  13. 13. Foreign Resource Mobilisation <ul><li>Foreign Currency; </li></ul><ul><ul><li>Line of Credit </li></ul></ul><ul><ul><li>Equity </li></ul></ul><ul><ul><li>Guarantees </li></ul></ul><ul><ul><li>Credit Risk Enhancement </li></ul></ul><ul><ul><li>Technical Assistance </li></ul></ul><ul><ul><li>Lenders priority-sectors </li></ul></ul>
  14. 14. Foreign Sources of Funds <ul><ul><li>PROPARCO-France </li></ul></ul><ul><ul><li>IFC </li></ul></ul><ul><ul><li>European Investment Bank </li></ul></ul><ul><ul><li>FMO-Netherlands </li></ul></ul><ul><ul><li>KfW-Germany </li></ul></ul><ul><ul><li>OPEC FUND </li></ul></ul><ul><ul><li>NORFUND-Norway </li></ul></ul><ul><ul><li>DEG – Germany </li></ul></ul><ul><ul><li>AfDB </li></ul></ul><ul><ul><li>Shell Foundation </li></ul></ul><ul><ul><li>Kuwait Fund </li></ul></ul><ul><ul><li>IDB </li></ul></ul><ul><ul><li>Saudi Fund </li></ul></ul><ul><ul><li>BADEA </li></ul></ul>
  15. 15. Funding Challenges <ul><ul><li>High cost of funds </li></ul></ul><ul><ul><li>Currency Restrictions </li></ul></ul><ul><ul><li>Inappropriate tenor </li></ul></ul><ul><ul><li>Sector Restriction </li></ul></ul><ul><ul><li>Borrowers – SMEs </li></ul></ul><ul><ul><li>BDS providers </li></ul></ul><ul><ul><li>Economy - status </li></ul></ul><ul><ul><li>Environmental Risk </li></ul></ul>
  16. 16. Funding Model <ul><ul><li>Commercial Banking services </li></ul></ul><ul><ul><li>Development Finance services </li></ul></ul><ul><ul><li>Leasing, Mortgage and Long-term Funding </li></ul></ul><ul><ul><li>Microfinance – Line of Credit to MFI’s </li></ul></ul><ul><ul><li>DFCU- all banking services under one roof </li></ul></ul><ul><ul><li>Technical Assistance – needed for Dev. Fin. </li></ul></ul><ul><ul><li>Government – Working with it </li></ul></ul><ul><ul><li>Funding – Locally and Internationally </li></ul></ul><ul><ul><li>Nationwide coverage </li></ul></ul><ul><ul><li>Negotiating skills and techniques with financiers </li></ul></ul>
  17. 17. Sources of Technical Assistance <ul><ul><li>IFC/WORLD BANK </li></ul></ul><ul><ul><li>European Investment Bank </li></ul></ul><ul><ul><li>FMO-Netherlands </li></ul></ul><ul><ul><li>Danida - Denmark </li></ul></ul><ul><ul><li>Dfid - Britain </li></ul></ul><ul><ul><li>USAID - USA </li></ul></ul><ul><ul><li>NORFUND-Norway </li></ul></ul><ul><ul><li>DEG – Germany </li></ul></ul><ul><ul><li>AfDB </li></ul></ul><ul><ul><li>Shell Foundation </li></ul></ul><ul><ul><li>IDB </li></ul></ul><ul><ul><li>Tech.Asst. for Capacity Building for Staff and SMEs </li></ul></ul><ul><ul><li>YOU NEED TECH. ASST. FOR DEV. FINANCE </li></ul></ul><ul><ul><li>Prepare proposals in time with </li></ul></ul><ul><ul><li>Development Impact </li></ul></ul>Beekeeper with a Bee hive
  18. 18. Moses K. Kibirige [email_address] Kampala - Uganda Thank youk Thank you
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