Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Credit risk
The Bank takes on exposure to credit risk, which is
the risk that a counter party will cause a financial loss
for the Bank by failing to discharge an obligation in
full when due. Impairment provisions are provided
for losses that have been incurred at the statement
of financial position date. Significant changes in the
economy, or in the health of a particular industry
segment that represents a concentration of the Bank’s
portfolio, could result in losses that are different
from those provided for at the statement of financial
position date.
Management therefore carefully
manages its exposure to credit risk.
The Bank structures the levels of credit risk it
undertakes by placing limits on the amount of risk
accepted in relation to one borrower, or groups of
borrowers, and to industry segments. Such risks are
monitored on a revolving basis and subject to annual
or more frequent review. Limits on the level of credit
risk by product, industry sector and by country are
approved by the Board of Directors.
The exposure to any one borrower including banks is
further restricted by sub-limits covering on- and offbalance sheet exposures and daily delivery risk limits
in relation to trading items such as forward foreign
exchange contracts. Actual exposures against limits
are monitored daily.
Exposure to credit risk is managed through regular
analysis of the ability of borrowers and potential
borrowers to meet interest and capital repayment
obligations and by changing lending limits where
appropriate. Exposure to credit risk is also managed in
part by obtaining collateral and corporate and personal
guarantees, but a significant portion is personal
lending where no such facilities can be obtained.
(a) Credit risk measurement
Debt securities
All debt securities the bank purchases are
government paper with no credit risk associated.
Loans and advances
In measuring credit risk of loan and advances to
customers and to banks at a counterparty level, the
Bank reflects three components
(i) the ‘probability of default’ by the client or counterparty on its contractual obligations;
(ii) current exposures to the counterparty and its likely
future development, from which the Bank derive
the ‘exposure at default’; and
(iii) the likely recovery ratio on the defaulted
obligations (the ‘loss given default’).
These credit risk measurements, which reflect expected
loss (the ‘expected loss model’) and are required by
the Basel Committee on Banking Regulations and
the Supervisory Practices (the Basel Committee), are
embedded in the Bank’s daily operational management.
The operational measurements can be contrasted with
impairment allowances required under IAS 39, which
are based on losses that have been incurred at the
statement of financial position date (the ‘incurred loss
model’) rather than expected losses (Note 3 (I) (ii).
(i) The Bank assesses the probability of default of
individual counterparties using internal rating tools
tailored to the various categories of counterparty.
They have been developed internally and combine
statistical analysis with credit officer judgment and
are validated, where appropriate, by comparison
with externally available data. Clients of the Bank
are segmented into four rating classes. The Bank’s
rating scale, which is shown below, reflects the
range of default probabilities defined for each
rating class. This means that, in principle, exposures
migrate between classes as the assessment of their
probability of default changes. The rating tools are
kept under review and upgraded as necessary. The
Bank regularly validates the performance of the
rating and their predictive power with regard to
default events.
The Bank’s internal ratings scale and mapping to
external ratings is as below:
Bank’s rating
1
2
3
Description of the grade
Standard monitoring
Special monitoring
Sub-standard
4
Doubtful
5
Loss
Observed defaults per rating category vary year
on year, especially over an economic cycle.
(ii) Exposure at default is based on the amounts the
Bank expects to be owed at the time of default.
For example, for a loan this is the face value. For
a commitment, the Bank includes any amount
already drawn plus the further amount that may
61
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Credit risk (continued)
have been drawn by the time of default, should it
occur.
Loss given default or loss severity represents
the Bank’s expectation of the extent of loss on
a claim should default occur. It is expressed as
percentage loss per unit of exposure and typically
varies by type of counterparty, type and seniority
of claim and availability of collateral or other credit
mitigation.
(a) Collateral
The Bank employs a range of policies and practices
to mitigate credit risk. The most traditional of
these is the taking of security for funds advanced,
which is common practice. The Bank implements
guidelines on the acceptability of specific classes
of collateral or credit risk mitigation. The principal
collateral types for loans and advances are:
• Mortgages over residential properties;
• Charges over business assets such as premises,
inventory and accounts receivable;
• Charges over financial instruments such as
debt securities and equities.
managed as part of the overall lending limits with
customers, together with potential exposures from
market movements. Collateral or other security
is not usually obtained for credit risk exposures
on these instruments, except where the Bank
requires margin deposits from counterparties.
Longer-term finance and lending to corporate
entities are generally secured; revolving individual
credit facilities are generally unsecured. In addition,
in order to minimise the credit loss the Bank will
seek additional collateral from the counterparty as
soon as impairment indicators are noticed for the
relevant individual loans and advances.
Collateral held as security for financial assets other
than loans and advances is determined by the
nature of the instrument. Debt securities, treasury
and other eligible bills are generally unsecured,
with the exception of asset-backed securities and
similar instruments, which are secured by portfolios
of financial instruments.
(b) Derivatives
The Bank maintains strict control limits on net open
derivative positions (i.e., the difference between
purchase and sale contracts), by both amount and
term. At any one time, the amount subject to credit
risk is limited to the current fair value of instruments
that are favourable to the Bank (i.e., assets where
their fair value is positive), which in relation to
derivatives is only a small fraction of the contract,
or notional values used to express the volume of
instruments outstanding. This credit risk exposure is
62
Settlement risk arises in any situation where a
payment in cash, securities or equities is made
in the expectation of a corresponding receipt
in cash, securities or equities. Daily settlement
limits are established for each counterparty to
cover the aggregate of all settlement risk arising
from the Bank’s market transactions on any
single day.
(c) Credit related commitments
The primary purpose of these instruments is to
ensure that funds are available to a customer
as required. Guarantees and standby letters of
credit, which represent irrevocable assurances
that Bank will make payments in the event that
a customer cannot meet its obligations to third
parties, carry the same credit risk as loans.
Documentary and commercial letters of credit,
which are written undertakings by the Bank on
behalf of a customer authorising a third party
to draw drafts on the Bank up to a stipulated
amount under specific terms and conditions, are
collateralised by the underlying shipments of
goods to which they relate and therefore carry
less risk than a direct borrowing.
Commitments to extend credit represent unused
portions of authorisations to extend credit in the
form of loans, guarantees or letters of credit.
With respect to credit risk on commitments to
extend credit, the Bank is potentially exposed
to loss in an amount equal to the total unused
commitments. However, the likely amount of
loss is less than the total unused commitments,
as most commitments to extend credit are
contingent upon customers maintaining specific
credit standards. The Bank monitors the term
to maturity of credit commitments because
longer-term commitments generally have a
greater degree of credit risk than shorter-term
commitments.
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Credit risk (continued)
(b) Impairment and provisioning policy
• Delinquency in contractual payments of principal or
interest;
• Cash flow difficulties experienced by the
borrower (e.g. equity ratio, net income
percentage of sales);
• Breach of loan covenants or conditions;
• Initiation of bankruptcy proceedings;
• Deterioration of the borrower’s competitive
position;
• Deterioration in the value of collateral;
The internal and external rating systems described
in Note 3 (I) (i) focus more on credit-quality
mapping from the inception of the lending and
investment activities. In contrast, impairment
provisions are recognised for financial reporting
purposes only for losses that have been incurred
at the statement of financial position date based
on objective evidence of impairment (see Note
2(I)). Due to the different methodologies applied,
the amount of incurred credit losses provided
for in the financial statements are usually lower
than the amount determined from the expected
loss model that is used for internal operational
management and banking regulation purposes.
The Bank’s policy requires the review of individual
financial assets that are above materiality thresholds
at least annually or more regularly when individual
circumstances require. Impairment allowances on
individually assessed accounts are determined by an
evaluation of the incurred loss at reporting date on a
case-by-case basis, and are applied to all individually
significant accounts. The assessment normally
encompasses collateral held (including re-confirmation
of its enforceability) and the anticipated receipts for
that individual account.
The impairment provision shown in the statement
of financial position at year-end is derived from
each of the five internal rating grades. However,
the majority of the impairment provision comes
from the bottom two gradings. The table below
shows the percentage of the Bank’s on and off
balance sheet items relating to loans and advances
and the associated impairment provision for each
of the Bank’s internal rating categories:
Collectively assessed impairment allowances are provided
for:
(i) Portfolios of homogenous assets that are individually
below materiality thresholds;
(ii) Losses that have been incurred but have not yet
been identified, by using the available historical
experience, experienced judgment and statistical
techniques.
(iii)Maximum exposure to credit risk before collateral
held or other credit impairments.
The internal rating tool assists management to
determine whether objective evidence of impairment
exists under IAS 39, based on the following criteria
set out by the Bank:
Standard & special monitoring
Sub-standard, doubtful and loss
Loans &
advances %
94.0
6.0
100.0
2012
Impairment
provision %
1.6
49.6
4.5
Loans &
advances %
97.2
2.8
100.0
2011
Impairment
provision %
1.1
48.8
2.5
63
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Credit risk (continued)
Bank of Uganda
Loans and advances to banks
Investment securities
Treasury bonds - available for sale
Treasury bills - available for sale
Treasury bills - pledged assets
Loans and advances to customers
Loans to individuals
Overdrafts
Term loans
Mortgages
Loans to corporate entities
Large corporate entities
Small & medium size entities
Trading assets
Treasury bonds
Treasury bills
Derivative assets
Other
2012 UShs’ 000
319,069,431
274,144,375
205,558,559
243,848,756
2,651,551
2,299,837
342,187,425
113,494,677
681,065,739
389,239,933
66,501,313
208,465,169
1,032,432
65,718,661
2,915,277,857
2011
UShs’ 000
189,298,997
297,576,996
311,890,887
21,679,376
764,878
3,892,362
418,731,150
117,226,698
553,558,827
477,867,065
798,900
5,425,442
66,750,758
2,465,462,336
Credit risk exposures relating to assets not included on the statement of financial position are as
follows:
Financial guarantees
Loan commitments and other credit related liabilities
161,819,874
298,181,280
460,001,154
3,375,279,011
85,788,165
360,444,450
446,232,615
2,911,694,951
The above table represents a worst case scenario of credit risk exposure to the Bank at 31 December 2012 and 2011,
without taking account of any collateral held or other credit enhancements attached. For on-balance-sheet assets,
the exposures set out above are based on net carrying amounts as reported in the statement of financial position.
64
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Credit risk (continued)
The table below shows the collateral coverage for the secured loans as at 31 December 2012.
As at 31
December
2012
Secured loans
Collateral coverage
Netting off
agreements Exposure after
netting off Total loans UShs’ 000 UShs’ 000 UShs’ 000 1,085,364,238 1,333,353 1,084,030,885 Unsecured loans 442,923,372 - - 1,528,287,610 1,333,353 1,084,030,885 51-100%
Over 100%
Total
secured loans
UShs’ 000 UShs’ 000 UShs’ 000
666,286,854 419,077,384 1,085,364,238
- -
666,286,854 419,077,384 - 1,085,364,238
As shown above, 61.4% of the total maximum exposure is derived from loans and advances to banks and customers (2011:
75.8%); 24.7% represents investments in debt securities (2011: 13.8%).
Management remains confident in its ability to continue to control the exposure of credit risk to the Bank resulting from both its loan
and advances portfolio and debt securities based on the following:
•
•
•
•
94% of the loans and advances portfolio is categorised in the top two grades of the internal rating system (2011: 97.2%);
Mortgage loans, are backed by collateral;
78.7% of the loans and advances portfolio are considered to be neither past due nor impaired (2011: 77.2%); and
All debt securities which the Bank has invested in are issued by the Bank of Uganda.
(iv) Loans and advances are summarised as follows:
Neither past due nor impaired
Past due but not impaired
Impaired loans and advances
Gross loans and advances
Allowances for impairment
Loans &
advances to
customers
UShs’000
1,203,435,688
232,689,052
92,162,870
1,528,287,610
(68,009,980)
1,460,277,630
2012
Loans &
advances to
banks
UShs’000
223,595,642
223,595,642
223,595,642
Loans &
advances to
customers
UShs’000
1,201,822,486
323,458,785
45,994,832
1,571,276,103
(39,417,446)
1,531,858,657
2011
Loans & advances
to banks
UShs’000
46,516,392
46,516,392
46,516,392
The total impairment provision for loans and advances is UShs 68,009 million (2011: UShs 39,417 million) of which UShs
45,736 million (2011: UShs 22,424 million) represents the individually impaired loans and the remaining amount of UShs
22,274 million (2011: UShs 16,993 million) represents the portfolio provision. Further information of the impairment
allowance for loans and advances to banks and to customers is provided in Note 20.
65
66
Total recognised
financial instruments
As at 31 December
2011
Personal and
Business banking
- Mortgage lending
- Instalment sales and
finance leases
- Other loans
Corporate and
investment banking
- Corporate lending
3,506,122 3,506,122
62,609,831
36,533,473
419,322,726 226,337,040 650,890,265 323,458,785 1,201,822,486
- 550,932,221 Total recognised
financial instruments
323,458,785
- 550,932,221 60,588,272 168,957,708 1,203,435,688 232,689,052 675,860,567
675,860,567 527,575,121
229,182,930
Corporate and
investment banking
- Corporate lending
31,408,721 69,407,429 322,857,842 159,325,036 38,449,173 Special
mention
UShs’000 Performing loans
135,309,850 As at 31 December
2012
Personal and
Business banking
- Mortgage lending
- Instalment sales and
finance leases
- Other loans
UShs’000 Standard 4,788,603 4,249,621 Sub standard
UShs’000 3,953,328 5,954,821 UShs’000 Doubtful Non performing loans
3,756,133 3,168,015 UShs’000 Loss 1,652,473
1,652,473 46,578
46,578 - 4,091,750 1,525,281,271
550,932,221 550,932,221 22,489,170
- - 99,143,304
1,145,018
645,659,766 17,252,402 974,349,050 22,489,170 229,545,980 - 9,736,888
- - 13,768,774
2,626,623 2,626,623 656,224
248,499
2,467,695 10,893,652 9,736,888 11,142,151 6,612,969 1,436,124,740 24,292,975 33,226,486 34,643,408 679,366,689
679,366,689 756,758,051 22,640,502
33,179,909
34,643,408
482,182,878 13,602,277 23,271,759 27,719,261 100,816,151 173,759,023 UShs’000 Total 3,691,318 8,378,974 UShs’000 Security
against
impaired
loans
8,806,747
4,993,483
UShs’000
Net impaired
loans
681,065,740
681,065,740 1,573,603
1,573,603 125,448
125,448
847,221,870
44,853,137
45,610,682
546,776,175 32,782,845 31,810,452
113,314,215 187,131,480 UShs’000 240,250,699 45,994,832
2,626,623 2,626,623 1,571,276,103
553,558,844 553,558,844 23,570,505
754,039 754,039 22,424,327
1,872,584
1,872,584
443,023
15,927,370
20,551,743
4,181,350
6,523,369 2,049,741
101,193,045
1,606,718
30,613,749 676,273,515 14,686,379 43,368,209 1,017,717,259 22,816,466 10,704,719 92,162,870 1,528,287,610 46,426,740 45,736,130
1,699,051
1,699,051 90,463,819
64,593,297 12,498,065 13,372,457 UShs’000 Total Total loans
The credit quality of financial assets is managed by the group using internal credit ratings. The table below shows the credit quality by class of financial asset for credit
risk related items, based on the group’s credit rating system.
(a) Credit quality
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Credit risk (continued)
As at 31 December 2012
Personal and Business
banking
- Mortgage lending
- Instalment sales and
finance leases
- Other loans
Corporate and investment
banking
- Corporate lending
As at 31 December 2011
Personal and Business
banking
- Mortgage lending
- Instalment sales and
finance leases
- Other loans
Corporate and investment
banking
- Corporate lending
Past due up to
30 days
UShs’000 Past due
Past due
30 - 60 days
60 - 180 days
UShs’000 UShs’000 Total
UShs’000
29,036,705 7,294,230 2,118,238 38,449,173
17,285,704 12,046,668 2,076,349 31,408,721
115,544,610 161,867,019 28,345,692 47,686,590 15,434,734 159,325,036
19,629,321 229,182,930
3,506,122
3,506,122
165,373,141
47,686,590
19,629,321
43,621,592 11,248,108 19,880,941 10,260,459 192,100,748 255,603,281 20,181,828 41,690,395 3,506,122
3,506,122
232,689,052
5,718,572 60,588,272
6,392,073 36,533,473
14,054,464 226,337,040
26,165,109 323,458,785
255,603,281
41,690,395
26,165,109
323,458,785
(c) Loans and advances to banks
The total gross amount of individually impaired loans and advances to banks as at 31 December 2012 was Nil
(2011: nil). No collateral is held by the Bank.
(d) Other financial assets
No other financial assets are individually or collectively impaired (2011: nil). No collateral is held by the Bank.
2012 2011
UShs’ 000 UShs’ 000
Nature of assets
Residential properties
12,937,090 6,116,366
Commercial properties
45,195,861 12,482,778
Vehicles
589,381 1,815,281
58,722,333 20,414,425
Repossessed properties are sold as soon as practicable, with the proceeds used to reduce the outstanding
indebtedness. Repossessed properties are not included on the statement of financial position.
67
68
- 297,576,996 Loans and advances to banks
Loans and advances to customers
Financial assets designated at fair
value:
- Debt securities
- Pledged assets
- Other assets
6,224,342
764,878
638,136,479
-
245,586,488
Transport
Individuals
Others
142,364,343
142,364,343
-
73,417,937
73,417,937
-
387,828,872
387,828,872
-
66,750,758
788,829,221
722,078,463
-
6,224,342
764,878
66,750,758
2,276,163,340
-
1,571,276,103
UShs’ 000
449,407,315
274,144,375
1,528,287,610
Total
297,576,996
UShs’ 000
653,942,489
UShs’ 000
341,086,803
274,966,482
2,651,551
65,718,661
2,595,175,994
333,570,263
UShs’ 000
115,349,954
- - - - - - - - - - - 65,718,661 119,990,005 115,349,954 341,086,803 719,661,150 - - - - 245,586,488
297,918,359
-
Agriculture
UShs’ 000
119,990,005
UShs’ 000
297,918,359
274,966,482 2,651,551 - 1,001,169,723 333,570,263 As at 31 December 2012
Government securities - AFS
Loans and advances to banks
Loans and advances to customers
Financial assets designated at fair
value:
- Debt securities
- Pledged assets
- Other assets
As at 31 December 2011
Government securities - AFS
Manufacturing Financial
institutions
UShs’ 000
449,407,315
274,144,375
-
The following table breaks down the Bank’s main credit exposure at their carrying amounts, as categorised by the industry sectors of our counterparties.
(d) Concentrations of risk of financial assets with credit risk exposure
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(e) Market risk
The Bank takes on exposure to market risks, which is the
risk that the fair value or future cash flows of a financial
instrument will fluctuate because of changes in market
prices. Market risks arise from open positions in interest
rate, currency and equity products, all of which are
exposed to general and specific market movements and
changes in the level of volatility of market rates or prices
such as interest rates, credit spreads, foreign exchange
rates and equity prices.
Market risk measurement techniques:
As part of the management of market risk, the Bank’s
major measurement techniques used to measure and
control market risk is value at risk and Pv01 (present
value at one).
The Bank applies ‘value at risk’ methodology (VaR)
to its trading portfolio, to estimate the market risk of
foreign exchange positions held and the maximum losses
expected. Management applies Pv01 methodology to its
trading and non trading portfolios to estimate the market
interest rate risk of positions held and the maximum
losses that could arise. The estimates are based upon
a number of assumptions for various changes in market
conditions. The assets and liabilities committee (ALCO)
sets limits on both the value of risk and Pv01that may
be acceptable for the Bank. These are monitored on a
weekly basis by the risk management department.
VaR is a statistically based estimate of the potential loss
on the current portfolio from adverse market movements.
It expresses the ‘maximum’ amount the Bank might lose,
but only to a certain level of confidence (98%). There
is therefore a specified statistical probability (2%) that
actual loss could be greater than the VAR estimate. Pv01
is the present value impact of a one basis point move in
an interest rate.
The use of these approaches does not prevent losses
outside of these limits in the event of more significant
market movements.
As VaR and Pv01 constitute an integral part of the
Bank’s market risk control regime, limits are established
by the Board annually for all trading and non-trading
portfolios. Actual exposure against limits, together with
a consolidated group-wide VaR, is reviewed daily by the
Bank’s Treasury.
The quality of the VaR model is continuously monitored
by back-testing the VaR results for trading books. All
back-testing exceptions and any exceptional revenues
on the profit side of the VAR distribution are investigated.
69
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(e) Market risk (continued)
12 months to 31 December 2012
Average Maximum Minimum UShs’ 000 UShs’ 000 UShs’ 000 Interest rate book - trading
17,374
37,272
(4,836)
Interest rate book available-for-sale
Foreign exchange risk VaR
101,316 661,236 12 months to 31 December 2011
Average Maximum Minimum Interest rate book - trading
Interest rate book available-for-sale
Foreign exchange risk VaR
UShs’ 000 3,741 UShs’ 000 20,434 UShs’ 000 82 26,624 19,329 2,811 15,446
27,463
116,312
31 December
2010
UShs’ 000
168
56,708 81,524 21,819 71,442
32,910 172,040 2,166 30,402
There are several drivers for VaR that include the changes
in FX Net Open Positions (NOP) held by the desk as well
as the changes in exchange rates on a daily basis. The
average NOP for 2012 was USD (2,372,722) 2011:
USD 189,032.
Generally, the FX desk was running relatively small
positions for the first half of the year due to the
uncertainty of the currency movements and generally
flat shilling with very low activity levels as the economy
recovered from the economic down turn, that begun in
mid-2011. In addition, an average short position with a
general depreciation of the shilling seen in 2012 only
shows that on average, the desk was on the safe side of
70
37,945 31 December
2011
UShs’ 000
the currency movements, if this was the opposite, then
we could have seen an increase in the VaR numbers.
The movements in the PV01 are largely attributed to
trading activity. The trading book run a small position for
Q1 as the market saw very high interest rates which had
spilled over from the previous year. The position changed
from Q2, i.e. PV01 increased significantly in anticipation
of drop in interest rates in H2. The banking Book position
increased, this was to take advantage of the high rates
.The outlook on interest rates was of a drop as the
economy recovered. The maturity profile of the banking
book stood at 1-2years. Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(e) Market risk (continued)
(c) Foreign exchange risk
The Bank takes on exposure to the effects of fluctuations in the prevailing foreign currency exchange rates on its
financial position and cash flows. The Asset and Liability Committee sets limits on the level of exposure by currency and
in total for both overnight and intra-day positions, which are monitored daily.
The Bank had the following significant foreign currency exposure positions (all amounts expressed in millions of Uganda
Shillings):
As at 31 December 2012
Assets
Cash and balances with Bank of Uganda
Loans and advances to banks
Amounts due from group companies
Loans and advances to customers
Other assets
Total Assets
Liabilities:
Customer deposits
Amounts due to banks
Amounts due to group companies
Other liabilities
Total Liabilities
Net statement of financial position
As at 31 December 2011
Total assets
Total liabilities
Net statement of financial position
USD
UShs’m
72,027
142,430
7,391
680,052
33,374
935,274
430,083
115,438
336,452
33,735
915,708
19,566
708,010
689,806
18,204
Euro
UShs’m
7,970
63,486
48
979
72,483
62,451
496
9,536
72,483
76,728
73,328
3,400
Other
UShs’m
2,770
9,141
19,328
1
31,240
9,386
3
21,633
31,022
217
43,754
36,609
7,145
Total
UShs’m
82,767
215,057
26,767
681,032
33,374
1,038,997
501,920
115,937
336,452
64,904
1,019,213
19,784
828,492
799,743
28,749
71
72
Up to 1
month
UShs’m
43,545
15,111
223,596
50,549
1,460,239
1,032
1,794,072
525,458
33,957
559,415
1,234,657
1,830,180
(660,498)
1,169,682
At 31 December 2012
Asset:
Cash and balances with Bank of Uganda
Government securities - available for sale
Government securities - for trading
Deposits and balances due from other banks
Amounts due from group companies
Loans and advances to customers
Pledged assets
Derivative assets
Other investment securities
Other assets
Total assets
Liabilities and shareholders’ funds:
Customer deposits
Deposits due to other banks
Borrowed funds
Amounts due to group companies
Derivative liabilities
Subordinated bonds / debts
Total liabilities
Total interest re-pricing gap
At 31 December 2011
Total assets
Total liabilities and shareholder’s equity
Total interest re-pricing gap
239,831
172,321
2,652
441,804
235,469
235,469
179,335
65,756
(155,718)
(89,962)
1 - 6 months
UShs’m
60,425
22,084
82,509
18,743
18,743
63,765
120,696
(30,968 )
89,728
6 - 12
months
UShs’m
105,606
65,451
171,057
10
24,703
316,453
49,113
390,279
(219,222)
153,228
(178,485)
(25,257)
Over 1 year
UShs’m
Non-interest
bearing
UShs’m
507,437
39
1,052
65,719
574,247
1,319,500
28,402
145,746
1,493,648
(864,949)
543,375
(1,392,583 )
(849,208)
507,437
449,407
274,967
223,596
50,549
1,460,278
2,652
1,032
1,052
65,719
3,036,687
2,099,180
33,957
24,703
344,855
145,746
49,113
2,697,554
339,135
2,713,233
(2,418,252 )
(294,983)
Total UShs’m
The table below summarises the Bank’s exposure to interest rate risks. Included in the table are the Bank’s assets and liabilities at carrying amounts, categorised by the
earlier of contractual re-pricing or maturity dates. The Bank does not bear an interest rate risk on items not on the statement of financial position.
The Bank takes on exposure to the effects of fluctuations in the prevailing levels of market interest rates on both its fair value and cash flow risks. Interest margins may
increase as a result of such changes but may reduce or create losses in the event that unexpected movements arise. The Asset and Liability Committee (ALCO) sets limits
on the level of mismatch of interest rate re-pricing that may be undertaken, which is monitored daily.
(d) Interest rate risk
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(e) Market risk (continued)
Furthermore the ALCO monitors the sensitivity of net interest income to changes in interest rates. Limits are set and
monitored monthly.
In 2011, ALCO increased the interest rate shock parameter from 200bps to 400bps to reflect the increased volatility (in
absolute terms) of the interest rates throughout the year and this has been applied through 2012.
The statement of financial position is shocked up and down by 400bps to get an indicative level of the potential drop or
increase in forecasted annual NII. The interest rate risk limit is set at 10% (for a 4% shock, a drop in NII is not expected
to exceed 10%). Where this is exceeded, then it is indicative of an adverse interest rate positioning of the statement
of financial position.
The table below summarises the sensitivity of a flat interest rate increase or decrease of 400bps at 31st December.
31st December 2012
Change in net
% of net
interest Income
interest
Ushs’000
income
400bps decrease in interest rates (10,675,214)
(5.1)
400bps decrease in interest rates 8,902,714
4.3
(f) Liquidity risk
Liquidity risk is the risk that the Bank is unable to meet its
payment obligations associated with its financial liabilities
when they fall due and to replace funds when they are
overdrawn. The consequence may be the failure to meet
obligations to repay depositors and fulfil commitments to
lend.
The Bank is exposed to daily calls on its available cash
resources from overnight deposits, current accounts,
maturing deposits, and calls on cash settled contingencies.
The Bank does not maintain cash resources to meet all of
these needs as experience shows that a minimum level of
reinvestment of maturing funds can be predicted with a
high level of certainty.
The Asset and Liability Committee sets limits on the
minimum proportion of maturing funds available to meet
such calls and on the minimum level of inter-bank and
other borrowing facilities that should be in place to cover
withdrawals at unexpected levels of demand.
The Bank’s liquidity management process, as carried out
within the Bank and monitored by a separate team in
Treasury, includes:
Liquid assets to deposit ratio
Total deposits
Total liquid assets held
Liquidity ratio
Regulatory requirement
31st December 2011
Change in
% of net
net interest
interest
Income
income
Ushs’m
(23,083,437) (7.5)
34,970,892 11.4
Day-to-day funding, managed by monitoring future cash
flows to ensure that requirements can be met. These
include replenishment of funds as they mature or are
borrowed by customers.
Maintaining a portfolio of highly marketable assets
that can easily be liquidated as protection against any
unforeseen interruption to cash flow;
Monitoring balance sheet liquidity ratios against
internal and regulatory requirements; and managing the
concentration and profile of debt maturities.
Monitoring and reporting take the form of cash flow
measurement and projections for the next day, week and
month respectively, as these are key periods for liquidity
management. The starting point for those projections is
an analysis of the contractual maturity of the financial
liabilities and the expected collection date of the financial
assets
Treasury also monitors unmatched medium-term assets,
the level and type of undrawn lending commitments, the
usage of overdraft facilities and the impact of contingent
liabilities such as standby letters of credit and guarantees.
2012
UShs’ 000
2,133,137,161
1,055,919,239
49.5%
20.0%
2011
UShs’ 000
1,900,316,566
686,399,490
36.1%
20.0%
73
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(f) Liquidity risk (continued)
The table below presents the cash flows payable by the Bank under financial liabilities by contractual maturities at the
statement of financial position date.
As at 31 December 2012
Asset:
Cash and balances with Bank of
Uganda
Government securities available for sale
Government securities - for
trading
Deposits and balances due from
other banks
Amounts due from group
companies
Loans and advances to
customers
Pledged assets
Derivative assets
Other investment securities
Investment in associate
Other assets
Intangible asset
Property and equipment
Total assets
Liabilities:
Customer deposits
Deposits due to other banks
Borrowed funds
Amounts due to group
companies
Derivative liabilities
Other liabilities
Subordinated bonds / debt
Total liabilities
Net liquidity gap
Cumulative liquidity gap
As at 31 December 2011
Total assets (expected maturity
dates)
Total liabilities (contractual
maturity dates)
Liquidity gap
Cumulative liquidity gap
74
Up to 1
month
Ushs’m
507,437
1- 6
months
Ushs’m
-
6 - 12
months
Ushs’m
-
Over
1 year
Ushs’m
-
Total Ushs’m
507,437
43,545 239,831 60,425 105,606 449,407
15,111 172,321 22,084 65,451 274,966
223,596 - - - 223,596
50,549 - - - 50,549
149,158 346,662 163,212 801,246 1,460,278
245,721
18,743
-
2,652
1,052
4,495
40,946
976,007
10
-
2,652
1,032
1,052
65,719
4,495
40,946
3,036,689
2,099,180
33,957
24,703
18,743
49,113
49,123
344,855
145,746
49,113
2,697,554
1,032
65,719
1,056,147
1,844,958
33,957
24,703
344,855
758,814
235,469
-
145,746
2,394,220
235,469
(1,403,791) (1,403,791) 523,345 (880,446) 226,977 (653,469) 927,024 273,555 273,555
1,052,287 345,925 324,621 990,402 2,713,235
(2,201,204)
(1,148,917)
(1,148,917)
(155,718 )
190,207
(958,710)
(30,968 )
293,653
(665,057)
(30,363)
960,039
294,982
(2,418,253)
294,982
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(f) Liquidity risk (continued)
Assets available to meet all of the liabilities and to cover
outstanding loan commitments include cash, central
bank balances, items in the course of collection; loans
and advances to banks; and loans and advances to
customers. In addition, debt securities and treasury and
other bills have been pledged to secure liabilities. The
Bank would also be able to meet unexpected net cash
outflows by selling securities and accessing additional
funding sources such as asset-backed markets.
(g) Off-balance sheet items
(a) Loan commitments
(b) Other financial facilities
Other financial facilities (Note 38) are also
included below based on the earliest contractual
maturity date.
(c) Operating lease commitments
Where the Bank company is the lessee, the
future minimum lease payments under noncancellable operating leases, as disclosed in Note
38, are summarised in the table below.
(d) Capital commitments
Capital commitments for the acquisition of buildings
and equipment (Note 38) are summarised in the
table below.
The dates of the contractual amounts of the
Bank’s off-balance sheet financial instruments
that commit it to extend credit to customers and
other facilities (Note 37), are summarised in the
table below.
As at 31 December 2012
Letters of credit
Guarantees
Commitments to extend credit
Operating lease commitments
As at 31 December 2011
Letters of credit
Guarantees
Commitments to extend credit
Operating lease commitments
Not later than 1 year
UShs’000
59,866,616
161,358,374
238,314,664
3,534,415
463,074,069
86,000,661
85,788,165
274,443,789
8,865,290
455,097,905
1 to 5 years
UShs’000
461,500
16,649,251
17,110,751
3,469,500
1,499,444
12,216,109
17,185,053
Total
UShs’000
59,866,616
161,819,874
238,314,664
20,183,666
480,184,820
89,470,161
87,287,609
274,443,789
21,081,399
472,282,958
75
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(h) Fair value of financial assets and liabilities
The table below summarises the carrying amounts and fair values of those financial assets and liabilities not
presented on the Bank’s statement of financial position at their fair value.
223,595,642 Carrying Value
2011
UShs’000
46,516,392
223,595,642 46,516,392
50,548,733 251,060,604
50,548,733 251,060,604
1,460,277,630 1,531,858,657
1,051,920 65,718,661 2,099,180,118 33,957,043 24,703,479 1,051,920
66,750,758
1,902,948,506
206,069,403
26,631,770
344,854,604 130,814,519
344,854,604 130,814,519
145,746,355 212,635,899
145,746,355 121,635,899
2012
UShs’000
Financial assets
Loans and advances to banks
Amounts due from group
companies
Loans and advances to
customers
Other investment securities
Other assets
Financial liabilities
Customer deposits
Amounts due to other banks
Borrowed funds
Amounts due to group
companies
Other liabilities
(i) Due from other banks and group
companies
2012
UShs’000
Fair Value
2011
UShs’000
1,460,277,630 1,531,858,657
1,051,920 65,718,661 1,051,920
66,750,758
2,099,180,118 1,902,948,506
33,957,043 206,069,403
24,703,479 26,631,770
(iii) Investment securities
Due from other banks includes inter-bank
placements and items in the course of collection.
The fair value of floating rate placements and
overnight deposits is their carrying amount. The
estimated fair value of fixed interest bearing
deposits is based on discounted cash flows using
prevailing money-market interest rates for debts
with similar credit risk and remaining period to
maturity.
Investment securities include only interestbearing assets held to maturity; assets classified
as available for sale are measured at fair value.
Fair value for held-to-maturity assets is based on
market prices or broker/dealer price quotations.
Where this information is not available, fair value
is estimated using quoted market prices for
securities with similar credit, maturity and yield
characteristics.
(ii) Loans and advances to customers
(iv) Due to other banks, customers and group
companies
The estimated fair value of deposits with no
stated maturity, which includes non-interestbearing deposits, is the amount repayable on
demand.
The estimated fair value of fixed interest-bearing
deposits and other borrowings not quoted in an
active market is based on discounted cash flows
using interest rates for new debts with similar
remaining period to maturity.
76
Loans and advances are net of provisions for
impairment. The estimated fair value of loans
and advances represents the discounted amount
of estimated future cash flows expected to be
received. Expected cash flows are discounted at
current market rates to determine fair value.
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(i) Fair value hierarchy
The determination of fair value for financial assets
and liabilities for which there is no observable
market price requires the use of valuation
techniques as described in accounting policy
2 (e)(v). For financial instruments that trade
infrequently and have little price transparency,
fair value is less objective, and requires varying
degrees of judgement depending on liquidity,
concentration, uncertainty of market factors,
pricing assumptions and other risks affecting the
specific instrument.
The Bank measures fair values using the following
fair value hierarchy that reflects the significance
of the inputs used in making the measurements:
Level 1: Quoted market price (unadjusted) in an
active market for an identical instrument.
Level 2: Valuation techniques based on observable
inputs, either directly (i.e., as prices) or indirectly
(i.e., derived from prices). This category includes
instruments valued using: quoted market prices
in active markets for similar instruments; quoted
prices for identical or similar instruments in
markets that are considered less than active; or
other valuation techniques where all significant
inputs are directly or indirectly observable from
market data.
Level 3: Valuation techniques using significant
unobservable inputs. This category includes
all instruments where the valuation technique
includes inputs not based on observable data
and the unobservable inputs have a significant
effect on the instrument’s valuation. This
category includes instruments that are valued
based on quoted prices for similar instruments
where significant unobservable adjustments or
assumptions are required to reflect differences
between the instruments.
77
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(i) Fair value hierarchy (continued)
The information below shows the classification of financial instruments held at fair value within the valuation
hierarchy set out below for the year ended 31 December 2012 and 2011:
31 December 2012
Financial assets
- Derivative assets
- Government securities - heldfor-trading
- Government securities available-for-sale
- Pledged assets
- Other investment securities
Total assets
Financial liabilities
- Derivative liabilities
Total liabilities
31 December 2011
Financial assets
- Derivative assets
- Government securities - held
for-trading
- Government securities available-for-sale
- Pledged assets
- Other investment securities
Total assets
Financial liabilities
- Derivative liabilities
Total liabilities
78
Level 1
UShs’ 000
1,032,432
Level 2
UShs’ 000
-
- 274,966,482 1,032,432
Level 1
UShs’ 000
-
449,407,315 2,651,551 - 727,025,348 - - Level 2 UShs’ 000 - - 6,224,342 - 333,570,263 146,470
146,470
764,878
340,559,483
-
Level 3
UShs’ 000
-
Total
UShs’ 000
1,032,432
- 274,966,482
1,051,920
1,051,920
Level 3
UShs’ 000
-
449,407,315
2,651,551
1,051,920
729,109,700
Total
UShs’ 000
-
- 6,224,342
- 333,570,263
1,051,920
1,051,920
-
764,878
1,051,920
341,611,403
146,470
146,470
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
4 Critical accounting estimates and
judgements in applying accounting
policies
The Bank makes estimates and assumptions that affect
the reported amounts of assets and liabilities within
the next financial year. Estimates and judgements
are continually evaluated and are based on historical
experience and other factors, including expectations of
future events that are believed to be reasonable under
the circumstances.
(a) Impairment losses on loans and
advances
The Bank assesses its loan portfolios for impairment
at each statement of financial position date. In
Personal & Business Banking
- Mortgage lending
- Instalment sales & finance leases
- Other lending
Corporate lending
determining whether an impairment loss should be
recorded in the income statement, the Bank makes
judgements as to whether there is observable data
indicating a measurable decrease in the estimated
future cash flows from a portfolio of loans before the
decrease can be allocated to an individual loan in that
portfolio. Estimates are made of the duration between
the occurrence of a loss event and the identification
of a loss on an individual basis. The impairment for
performing loans is calculated on a portfolio basis,
based on historical loss ratios, adjusted for national
and industry-specific economic conditions and other
indicators present at the reporting date that correlate
with defaults on the portfolio. These annual loss ratios
are applied to loan balances in the portfolio and scaled
to the estimated loss emergence period. At year end,
the Bank applied the following loss emergence periods:
Loss emergence period
2012 2011
Months Months
3 3
3 3
3 3
3 3
12 12
Sensitivity1
2012 2011
Ushs’000 Ushs’000
5,092,508 2,937,236
1,122,066 1,175,250
535,712 844,162
3,434,730 917,824
676,005 443,390
5,768,513 3,380,626
1- Sensitivity is based on the effect of a change of one month in the emergence period on the value of the impairment.
(b) Non-performing loans
Retail loans are individually impaired if the amounts are due and unpaid for three or more months. Corporate
loans are analysed on a case-by-case basis taking into account breaches of key loan conditions. Management’s
estimates of future cash flows on individually impaired loans are based on historical loss experience for assets
with similar credit risk characteristics. The methodology and assumptions used for estimating both the amount and
timing of future cash flows are reviewed regularly to reduce any differences between loss estimates and actual loss
experience. Recoveries of individual loans as a percentage of the outstanding balances are estimated as follows:
Personal & Business Banking
- Mortgage lending
- Instalment sales & finance leases
- Other lending
Corporate lending
Recoveries as a % of impaired
loans
2012 2011
% %
25 25
10 10
28 28
33 33
47 47
Sensitivity1
2012 Ushs’000 713,408 160,993 178,531 373,884 25,485 738,893 2011
Ushs’000
682,929
149,325
269,573
264,031
38,267
721,196
1- Sensitivity is based on the effect of a change of one month in the emergence period on the value of the impairment.
79
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
(c) Fair value of derivatives
The fair value of financial instruments that are not
quoted in active markets are determined by using
valuation techniques. Where valuation techniques
(for example, models) are used to determine fair
values, they are validated and periodically reviewed
by qualified personnel independent of the area that
created them. All models are certified before they are
used, and models are calibrated to ensure that outputs
reflect actual data and comparative market prices.
To the extent practical, models use only observable
data, however areas such as credit risk (both own
and counterparty), volatilities and correlations
require management to make estimates. Changes in
assumptions about these factors could affect reported
fair value of financial instruments.
(d) Impairment of available for-sale equity
investments
The Bank determines that available-for-sale equity
investments are impaired when there has been a
significant or prolonged decline in the fair value below
its cost. This determination of what is significant
or prolonged requires judgement. In making this
judgement, the Bank evaluates among other factors,
the normal volatility in price. In addition, impairment
may be appropriate when there is evidence of
deterioration in the financial health of the investee,
industry and sector performance, changes in
technology, and operational and financing cash flows.
Had the declines of financial instruments with fair
values below cost been considered significant or
prolonged, the Bank would suffer an additional loss
of UShs 5,401 million (2010: UShs 30,132 million)
in its financial statements, being the transfer of the
negative revaluations within available-for-sale reserve
to the income statement.
keep these investments to maturity other than for
the specific circumstances – for example, selling an
insignificant amount close to maturity – it will be
required to classify the entire class as available-forsale. The investments would therefore be measured
at fair value not amortised cost. If the entire class of
held-to-maturity investments were tainted, the fair
value would decrease by UShs nil (2011: Nil), with a
corresponding entry in the available-for-sale reserve
in shareholders’ equity.
5 Segment information The principal business units in the Bank are as
follows: Personal and Business Banking (PBB): Banking and
other financial services to individual customers and
small to medium sized enterprises throughout Uganda.
PBB incorporates:
•
•
•
Mortgage lending- provides residential accommodation loans to individual customers. Instalment sales and finance leases: comprises
two main areas - instalment finance in the
consumer market mainly vehicles and secondly,
finance of vehicles and equipment in the business
market. Transactional and lending products- Transactions
in products associated with the various points
of contact channels such as ATMs, internet, and
branches. This includes deposit taking activities,
electronic banking, cheque accounts and other
lending products.
Corporate and Investment Banking (CIB): Commercial and investment banking services to larger
corporates, financial institutions, and international counterparties in Uganda.
(e) Held to maturity investments
CIB incorporates:
The Bank follows the guidance of IAS 39 on
classifying non-derivative financial assets with
fixed or determinable payments and fixed maturing
as held-to-maturity. This classification requires
significant judgement. In making this judgement,
the Bank evaluates its intention and ability to hold
such investments to maturity. If the Bank fails to
•
80
•
Global markets - includes foreign exchange, fixed
income, derivatives, and money market funding
units. Investment banking and trade finance - includes
corporate lending and transactional banking
businesses, trade finance business and property
related lending to corporates.
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
5 Segment information (continued)
The segment results for the year ended 31 December 2012 and 31 December 2011 are as follows:
Personal and
Corporate and
Business Investment Total
Banking
Banking
Income statement
UShs’ 000 UShs’ 000 UShs’ 000
Year ended 31 December 2012 Operating income
320,273,655 188,291,257 508,564,912
Income from associate
- - Impairment losses
(116,413,919) 481,033 (115,932,886)
Other operating expenses
(155,414,601) (59,516,093) (214,930,694)
Profit before tax
48,445,135 129,256,197 177,701,332
Income tax expense
(13,307,315) (33,659,944) (46,967,260)
Profit after tax
35,137,820 95,596,253 130,734,074
Year ended 31 December 2011 Operating income
281,442,424 98,646,793 380,089,217
Income from associate
1,288,438 - 1,288,438
Impairment losses
(28,750,436) (178,695) (28,929,131)
Other operating expenses
(136,184,759) (52,447,872) (188,632,631)
Profit before tax
117,795,667 46,020,226 163,815,893
Income tax expense
(33,515,719) (8,598,444) (42,114,163)
Profit after tax
84,279,948 37,421,782 121,701,730
Statement of financial position As at 31 December 2012
Total assets
Total Liabilities
Capital expenditure
Other segment items included in the income
statement
Depreciation
Amortisation of intangible assets
As at 31 December 2011
Total assets
Total liabilities
Capital expenditure
Other segment items included in the income
statement
Depreciation
Amortisation of intangible assets
Personal and
Business
Banking
UShs’ 000
1,068,380,249
874,052,798
14,524,790
9,778,936
20,495
1,293,930,624
1,012,309,151
2,490,877
Corporate and
Investment
Banking
UShs’ 000
2,030,213,150
1,823,501,315
3,033,475
Total
UShs’ 000
3,098,593,400
2,697,554,114
17,558,265
2,042,312
4,280
1,419,304,647
1,405,942,649
1,283,179
11,821,248
24,775
2,713,235,271
2,418,251,800
3,774,056
985,155 12,445 11,800,739
24,775
10,815,584 12,330 81
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
6 Interest income
Government securities
Loans and advances to customers
Loans and advances to banks
Placements with group companies
2012
UShs’ 000
28,739,714
312,020,508
6,088,036
2,069,887
348,918,145
2011
UShs’ 000
29,523,624
266,683,148
1,390,402
2,143,634
299,740,808
Interest income above includes the unwinding effect of the net fee and commissions income included in determining
the effective interest rate on financial assets measured at amortised cost of UShs 8,606 million (2011: UShs 9,606
million).
7 Interest expense
Current accounts
Savings and deposit accounts
Subordinated debt: - Group entity
- Non-group entities
Deposits and borrowings from banks
Amounts due to group companies
Interest paid on other money market borrowings
2012
UShs’ 000
4,491,050
26,866,037
753,802
4,515,388
10,578,834
4,694,984
325,840
52,225,935
2011
UShs’ 000
1,579,610
12,296,083
123,367
4,323,148
26,630,343
2,362,215
2,608,571
49,923,337
2012
UShs’ 000
114,459,075
4,007,024
118,466,099
2011
UShs’ 000
87,338,257
7,967,682
95,305,939
(1,060,125)
94,245,814
8 Net fee and commission income
Fee and commission income
Transactional fees & commission income
Credit related fees & commission income
Fee and commission expense
Transactional fees & commission expenses
Net fee and commission income
(3,308,786)
115,157,313
Net fee and commission income above excludes amounts included in determining the effective interest rate on
financial assets measured at amortised cost of UShs 5,015 million (2011: UShs 11,609 million).
9 Net trading income
2012
UShs’ 000
Foreign exchange trading gains - Realized gains
Foreign exchange trading gains - Unrealized gains
Debt securities trading gains
Fair value through P&L
50,636,141
(848,934)
42,343,475
3,305,366
95,436,048
2011
UShs’ 000
28,917,192
812,625
5,149,868
1,048,491
35,928,176
Debt securities include the effect of buying and selling and changes in the fair value of government securities.
Included in foreign exchange trading are gains and losses from spot and forward contracts and other currency
derivatives.
82
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
10 Other operating income/ (expense)
(Loss) on disposal of property and equipment
Rental income
Dividend income
Other
2012
UShs’ 000
(38,147)
30,596
112,941
1,135,805
1,241,195
2011
UShs’ 000
(160,135)
82,947
14,808
(62,380)
Other operating income - other, is largely constituted by gains from disposal of the bank’s investment in associate
- UShs 588m, and write-back to income statement of stale cheques over 3 years - UShs 365m
11 Impairment charge for credit losses
2012
UShs’ 000
Net credit impairment raised and reversed for loans and
advances (Note 20)
Recoveries on loans and advances previously written off
2011
UShs’ 000
125,179,454
32,614,535
(9,246,568)
115,932,886
(3,685,404)
28,929,131
2012
UShs’ 000
72,928,140
8,568,005
7,114,452
88,610,597
2011
UShs’ 000
64,978,009
8,841,107
5,788,262
79,607,378
2012
UShs’ 000
19,875,230
10,662,164
398,617
33,775
13,672,309
5,608,746
3,397,826
1,403,270
3,787,605
9,763,144
15,292,331
473,206
2,364,130
3,890,403
12,380,399
1,660,629
210,272
840,687
8,539,197
114,253,940
2011
UShs’ 000
18,445,215
7,290,665
361,496
112,266
12,204,497
3,929,939
2,366,655
2,013,521
3,335,798
6,811,417
11,481,269
283,204
1,165,572
1,836,067
9,293,439
1,775,307
28,059
749,648
13,555,569
97,039,603
12 Employee benefit expenses
Salaries and wages
Contributions to statutory and other defined benefit plans
Other
13 Other operating expenses
Premises costs
Office expenses
Auditors remuneration
Professional fees
IT expenses
Travel and entertainment
Marketing and advertising
Insurance
Deposit protection scheme contribution
Security expenses
Franchise fees
Directors fees & expenses
Training costs
Operational losses
Indirect taxes (VAT)
Bank charges
Leased equipment rental
Credit bureau expenses
Other operating expenses
83
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
14 Income tax expense
2012
UShs’ 000
Current income tax
Deferred income tax (see note 23)
47,875,296
(908,037)
46,967,259
2011
UShs’ 000
45,509,381
(3,395,217)
42,114,164
The income tax on the company’s profit before income tax differs from the theoretical amount that would arise
using the statutory income tax rate as follows:
Profit before income tax
Tax calculated at statutory tax rate of 30% (2011: 30%)
Tax effects of:
Income not subject to tax
Income subject to tax at 20%
Expenses not deductible for tax purposes
Prior year current income tax under provision
2012
UShs’ 000
177,701,330
53,310,399
(568,145)
(7,067,614)
1,264,727
27,892
46,967,259
2011
UShs’ 000
163,815,893
49,144,768
(1,422,286)
(7,010,921)
1,170,363
232,240
42,114,164
2012
UShs’ 000
(7,460,343)
27,892
47,847,404
(47,869,023)
(7,454,070)
2011
UShs’ 000
(6,607,285)
232,240
45,277,141
(46,362,439)
(7,460,343)
2012
130,734,072
2011
121,701,729
34,125,780
8,104,873
The movement in the current income tax recoverable is as follows:
At start of year
Prior year under provisions
Income tax charge
Tax paid
At end of year
15 Earnings per share - basic and diluted
Basic
Profit attributable to ordinary shareholders (UShs’000)
Weighted average number of ordinary shares in issue
(thousands)
Basic earnings per share (expressed in UShs per share)*
3.83
3.57
There were no potentially dilutive shares as at 31 December 2012 or on 31 December 2011. Therefore, diluted
earnings per share are the same as basic earnings per share.
** 2011 earnings per share have been normalized based on shares in issue as at 2012
84
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
16 Cash and balances with Bank of Uganda
2012
UShs’ 000
188,367,871
319,069,431
507,437,302
Coins & bank notes
Balances with Bank of Uganda
2011
UShs’ 000
220,024,337
189,298,997
409,323,334
Banks are required to maintain a prescribed minimum cash balance with Bank of Uganda that is not available to
finance the Bank’s day-to-today activities. The amount is determined by bank of Uganda on a pre-set formula on a
rolling fortnightly basis; 8% in 2012 (2011: 8%). The reserve as at 31 December 2012 is UShs 179,880m (2011:
UShs 154,220m).
17 Government securities – available-for-sale
Government security - available-for-sale
Treasury bills
Treasury bonds
2012
UShs’ 000
2011
UShs’ 000
243,848,756
205,558,559
449,407,315
21,679,376
311,890’887
333,570,263
Government treasury bills are debt securities issued by Bank of Uganda for a term of three months, six months or
one year. Government bonds are debt instruments issued by Bank of Uganda for a term of either two, three, five
or ten years.
Government securities are categorised as assets held to maturity which are carried at amortised cost, available
for sale which are fair valued through reserves and held for trading, which are fair valued through the income
statement.
The weighted average effective interest rate on treasury bills and bonds, including pledged assets (see note 18)
was 11.8% (2011:11.7%)
18
Pledged assets
2012
UShs’ 000
2,651,551
2,651,551
Treasury bills
2011
UShs’ 000
764,878
764,878
These are securities pledged as collateral to the Bank of Uganda under the electronic clearing house rules and are
separately classified as pledged assets on the face of the statement of financial position. These have a market value
at 31 December 2012 of UShs 2,651m (2011: UShs 765m).
19
Loans and advances to banks
Items in course of collection - foreign banks
Placements with local banks
Placements with foreign banks
2012
UShs’ 000
6,421,694
20,032,060
197,141,888
223,595,642
2011
UShs’ 000
1,523,618
7,720,678
37,272,096
46,516,392
The weighted average effective interest rate on loans and advances to banks was 5.7% (2011: 18.6%)
85
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
20 Loans and advances to customers
Personal and business banking
Mortgage lending
Instalment sales and finance leases
Other loans and advances
Corporate and investment banking
Corporate lending
Gross loans and advances
Less: provision for impairment
2012
UShs’ 000 2011
UShs’ 000
187,131,480
113,314,215
546,776,175
681,065,740
240,250,698
101,193,046
676,273,515
553,558,844
1,528,287,610
1,571,276,103
(68,009,980)
(39,417,446)
1,460,277,630
1,531,858,657
Included in other loans and advances is the fair value adjustment of loans advanced to staff at off market rates.
9,809m (2011: UShs 7,990m).
86
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
20 Loans and advances to customers (continued)
Movements in provisions for impairment of loans and advances are as follows:
Mortgage
lending
UShs’ 000
Non performing loans
At 1 January 2012
Impaired accounts written off
Net provisions raised/
(released)
Effects of foreign exchange
movements
At 31 December 2012
Performing loans
At 1 January 2012
Net impairments raised
At 31 December 2012
Total
Non performing loans
At 1 January 2011
Impaired accounts written off
Net impairments raised &
released
Effects of foreign exchange
movements
At 31 December 2011
Instalment
sales and Other loans &
finance
Advances
leases
UShs’ 000
UShs’ 000
4,191,351
443,033 15,917,370
(39,152,611) (2,037,824) (52,278,158)
36,988,303
10,051,919
Corporate
lending
Total
UShs’ 000
UShs’ 000
1,872,584
22,424,338
- (93,468,593)
74,549,892 (1,807,369)
119,782,745
2,976,441
349,629
(6,388,653)
60,233
(3,002,350)
5,003,484
8,806,757
31,800,451
125,448
45,736,139
2,401,574
264,875
2,666,449
2,532,765
(924,986)
1,607,779
6,515,231
4,724,340
11,239,571
5,543,537
1,216,503
6,760,040
16,993,107
5,280,732
22,273,839
7,669,933
10,414,536
43,040,022
6,885,488
68,009,978
1,681,241
8,642,776
(2,812,609) (13,626,188) 1,721,932
- 13,939,890
(18,257,084)
150,652 27,195,703
1,893,941
(1,818,287) 4,281,177 1,909,812 20,854,062 (165,480) (335,412) 46,720 - (454,172)
4,191,351
443,032
15,917,370
1,872,584
22,424,338
Performing loans
At 1 January 2011
Net impairments raised
At 31 December 2011
340,208
2,061,366 2,401,574
1,281,457
1,251,308 2,532,765
4,437,116
2,078,115 6,515,231
5,515,494
28,043 5,543,537
11,574,275
5,418,832
16,993,107
Total
6,592,925
2,975,797
22,432,601
7,416,121
39,417,446
All impaired loans have been written down to their estimated recoverable amount. The aggregate carrying amount of
impaired loans at 31 December 2012 was UShs 45,736 million (2011: UShs 22,424 million).
The weighted average effective interest rate on loans and advances was 19% (2011: 23.6%)
87
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
20 Loans and advances to customers (continued)
The loans and advances to customers include finance lease receivables as follows;
2012
UShs’ 000 Gross investment in finance leases
No later than 1 year
Later than 1 year but no later than 5 years
2011
UShs’ 000
11,506,866
232,064,016
243,570,882
10,291,778
125,629,039
135,920,817
Unearned future finance income on finance leases
(48,624,766)
(34,727,771)
Net investment in finance leases
194,946,116
101,193,046
10,848,923
184,097,193
194,946,116
9,503,077
91,689,969
101,193,046
The net investment in finance leases may be analysed as follows:
No later than 1 year
Later than 1 year but no later than 5 years
Later than 5 years
As at 31 December 2012, the Bank had no exposures to a single borrower or group of borrowers exceeding 25%
of the core capital of the Bank.
21 Other investment securities
S.W.I.F.T. SCRL
African Export and Import Bank (0.04% owned)
2012
UShs’ 000 844,200
207,720
1,051,920
2011
UShs’ 000
844,200
207,720
1,051,920
22 Investment in associate
The movement in the investment in the Bank’s associate is represented by the following movement:
As at 1 January
Share of profits
Dividend received
Disposals
As at 31 December
88
2012
UShs’ 000 2,625,516
587,703
112,941
(3,326,160)
-
2011
UShs’ 000
2,421,996
1,288,438
(1,084,918)
2,625,516
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
22 Investment in associate (continued)
The Bank’s interest in its principal associate, which is un-listed, is as follows:
Country of
incorporation
31 December 2012
Stanbic Investment Management Services
31 December 2011
Stanbic Investment Management Services
Kenya
Kenya
Net assets
UShs’000
Revenue
UShs’000
Interest
held %
-
-
0%
5,820,501 16,513,693 23%
23 Deferred income tax
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority. Deferred
income taxes are calculated on all temporary differences under the balance sheet liability method using tax rates
currently enacted. The movement on the deferred income tax account is as follows:
As at 1 January
Income statement movement
Available-for-sale government securities
As at 31 December
2012
UShs’ 000 18,562,030
908,037
(10,599,038)
8,871,029
2011
UShs’ 000
6,022,195
3,395,217
9,144,618
18,562,030
The deferred income tax asset on the statement of financial position comprises the following categories:
2012
UShs’ 000 Deferred income tax assets
Provisions for loans and advances
Available for sale government securities
Other deductible temporary differences
Deferred income tax liabilities
Property and equipment
Net deferred income tax asset
2011
UShs’ 000
7,730,888
2,314,581
3,088,218
13,133,687
5,937,449
12,913,619
2,185,791
21,036,859
(4,262,658)
8,871,029
(2,474,829)
18,562,030
The deferred tax charge in the income statement comprises the following categories:
2012
UShs’ 000 Property and equipment
Provisions for loans and advances
Other deductible temporary differences
(1,787,829)
1,793,439
902,428
908,038
2011
UShs’ 000
1,087,255
1,859,650
448,312
3,395,217
89
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
24 Prepaid operating leases
2012
UShs’ 000 Cost
As at 1 January
Additions for the year
As at 31 December
Amortisation
As at 1 January
Charge for the year
As at 31 December
Carrying value
As at 31 December
2011
UShs’ 000
239,141
239,141
239,141
239,141
(88,791)
(10,338)
(99,129)
140,012
(78,614)
(10,177)
(88,791)
150,350
25 Other assets
Clearances in transit
Prepayments
Recoverable losses
Fees receivable
Other accounts receivable
2012
UShs’ 000
23,808,720
15,603,852
71,941
1,041,285
25,192,863
65,718,661
2011
UShs’ 000
15,782,255
12,156,147
2,014,486
2,389,368
34,408,502
66,750,758
Approximately 60% of the amount under “Other accounts receivable” relates to Ushs currency that was sold to
purchase foreign currency amounts to cater for supplier payments in foreign currency.
90
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
26 Goodwill and other intangible assets
Cost
At 1 January 2012
Additions
Impairment
At 31 December 2012
Amortisation
At 1 January 2012
Charge for the year
At 31 December 2012
Net book value
At 31 December 2012
Cost
At 1 January 2011
Additions
Impairment
At 31 December 2011
Amortisation
At 1 January 2011
Charge for the year
At 31 December 2011
Net book value
At 31 December 2011
Computer
software
UShs’ 000 Goodwill
Total
UShs’ 000
UShs’ 000
208,457
2,729,838
2,938,295
1,901,592
1,901,592
2,110,049
2,729,838
4,839,887
138,260
206,764
345,024
-
138,260
206,764
345,025
2,593,270
1,901,592
4,494,862
208,457
208,457
1,901,592
1,901,592
2,110,049
2,110,049
113,485
24,775
138,260
-
113,485
24,775
138,260
70,196
1,901,592
1,971,788
Goodwill is reviewed annually for impairment, or more frequently when there are indications that impairment may
have occurred. There was no impairment of goodwill identified in 2012 (2011: nil).
91
92
2,685,596
Net book value
At 31 December 2012
Net book value
At 31 December 2011
Depreciation
At 1 January 2011
Charge for the year
On disposals
At 31 December 2011
2,755,017
3,432,496
3,432,496
608,058
69,421
677,479
677,479
69,421
746,900
Depreciation
At 1 January 2012
Charge for the year
On disposals
At 31 December 2012
Cost
At 1 January 2011
Additions
Transfers
Disposals
At 31 December 2011
3,432,496
3,432,496
UShs’ 000
Land and
buildings
Cost
At 1 January 2012
Additions
Transfers
Disposals
At 31 December 2012
27 Property and equipment
19,869,831
26,738,591
4,857,269
(1,325,189)
30,270,671
37,802,070
3,613,221
10,104,169
(1,378,958)
50,140,502
UShs’ 000
Computer
equipment
20,649,241
11,063,479
61,973,413 43,446,763 2,567,313 1,206,743 - - (16,800,677) (6,851,436) 47,740,049 37,802,070 37,323,958 28,701,073 6,473,872 4,651,362 (16,707,022) (6,613,844) 27,090,808 26,738,591 17,964,876
27,090,808
6,443,654
(4,035,900)
29,498,562
47,740,049
3,805,764
35,111
(4,117,486)
47,463,438
Furniture,
fittings and
equipment
UShs’ 000
876,360
4,082,746
(311,684)
3,771,062
2,561,766
606,084
(273,148)
2,894,702
425,456
2,894,702
450,904
3,345,606
3,771,062
3,771,062
UShs’ 000
Motor
vehicles
-
-
0
-
10,139,280
(10,139,280)
0
UShs’ 000
Work in
progress
35,344,097
112,935,418
3,774,056
(23,963,797)
92,745,677
69,194,855
11,800,739
(23,594,014)
57,401,580
40,945,759
57,401,580
11,821,248
(5,361,089)
63,861,739
92,745,677
17,558,265
(5,496,444)
104,807,498
UShs’ 000
Total
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
28 Share capital
Issued and fully paid
At 1 January 2012
Bonus issue - 30 May
2012
At 31 December 2012
Issued and fully paid
At 1 January 2011
Bonus issue - 30 May
2011
At 31 December 2011
Number of
ordinary shares
(thousands)
Ordinary share
capital
UShs’ 000
Share premium
Total
UShs’ 000
UShs’ 000
10,237,734
10,237,734
20,411,266
30,649,000
40,950,936
51,188,670
40,950,936
51,188,670
(20,411,266)
-
20,539,670
51,188,670
Number of
ordinary shares
(thousands)
Ordinary share
capital
UShs’ 000
Share premium
Total
UShs’ 000
UShs’ 000
5,118,867
5,118,867
20,411,266
25,530,133
5,118,867
10,237,734
5,118,867
10,237,734
20,411,266
5,118,867
30,649,000
The total authorised number of ordinary shares is 51,188,669,700 shares (2011: 10,237,733,940 shares)
with a par value of UShs 1 per share (2011: UShs 1 per share). The issued number of shares at year end was
51,188,669,700 (2011: 10,237,733,940) following a bonus issue. All issued shares are fully paid.
At the annual general meeting held on 21 May 2012, the shareholders approved the increase in the authorised
share capital to 51,188,669,700 by issuing bonus shares on a 4: 1 basis off the existing shares. The increase
in share capital was financed by capitalising the sum of UShs 20,411,265,727 from Share premium and UShs
20,539,670,033 from retained earnings.
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to
one vote per share at annual and other general meetings of the Bank.
29 Available-for-sale revaluation reserve
At 1 January
2012
UShs’ 000 (30,131,779)
Net gains/(losses) from changes in fair value
Deferred tax on fair value change
Net movement for the year
35,330,128
(10,599,038)
24,731,090
(30,482,061)
9,144,618
(21,337,443)
(5,400,689)
(30,131,779)
At 31 December
2011
UShs’ 000
(8,794,336)
93
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
30 Statutory credit risk reserve
The statutory credit risk reserve represents amounts by which provisions for impairments of loans and advances,
determined in accordance with the Financial Institutions Act 2004 exceed those determined in accordance with
International Financial Reporting Standards. These amounts are appropriated from retained earnings in accordance
with accounting policy (j).
Gross loans and advances (including off BS items)
Less:
Identified impairment charges (regulatory)
Interest in suspense
Unidentified impairment (regulatory requirement)
Identified impairment (in accordance with IFRS)
Unidentified impairment (in accordance with IFRS)
Statutory credit risk reserve
94
2012
UShs’ 000
1,771,904,491
66,419,204
9,881,329
1,695,603,959
16,956,040
45,736,139
22,273,850
15,365,255
2011
UShs’ 000
1,825,277,501
22,424,328
1,863,239
1,800,989,934
18,009,899
22,424,328
16,993,119
1,016,780
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
31Derivatives
The Bank uses currency forward derivative instruments for non-hedging purposes. Currency forwards represent
commitments to purchase foreign and domestic currency, including undelivered spot transactions. The notional
amounts of certain types of financial instrument provide a basis for comparison with instruments recognised on
the statement of financial position but do not necessarily indicate the amounts of future cash flows involved or the
current fair value of the instruments and, therefore, do not indicate the bank’s exposure to credit or price risks. The
derivative instruments become favourable (assets) or unfavourable (liabilities) as a result of fluctuations in market
foreign exchange rates on hand relative to their terms. The aggregate contractual or notional amount of derivative
financial instruments, the extent to which instruments are favourable or unfavourable, and thus the aggregate fair
values of derivative financial assets and liabilities, can fluctuate significantly from time to time. The maturity analysis
of the fair values of derivative instruments held is set out below.
Less than 1 year
UShs’ 000
1-5 years
UShs’ 000
Over 5 years
UShs’ 000
Total
UShs’ 000
As at 31 December 2012
Assets
Derivatives held-for-trading
Currency forwards
Fair value of assets
1,032,432
1,032,432
-
-
1,032,432
1,032,432
Liabilities
Derivatives held-for-trading
Currency forwards
Fair value of liabilities
-
-
-
-
1,032,432
-
-
1,032,432
Net fair value
As at 31 December 2011
Assets
Derivatives held-for-trading
Currency forwards
Fair value of assets
- - -
- - -
- - -
-
Liabilities
Derivatives held-for-trading
Currency forwards
Fair value of liabilities
- 146,470 146,470
- - -
- - -
146,470
146,470
-
-
Net fair value
(146,470)
(146,470)
32 Customer deposits
Current and demand deposits
Savings accounts
Fixed and call deposit accounts
2012
UShs’ 000 1,602,815,835
175,426,475
320,937,808
2,099,180,118
2011
UShs’ 000
1,362,209,456
254,494,971
286,244,079
1,902,948,506
The weighted average effective interest rate on customer deposits was 2.8% (2011: 1.9%).
95
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
33 Deposits and balances due to banks
Balances due to other banks - local currency
Balances due to other banks - foreign currency
2012
UShs’ 000 33,458,162
498,881
33,957,043
2011
UShs’ 000
188,693,071
17,376,332
206,069,403
The weighted average effective interest rate on deposits and balances due to banks was 4.8% (2011: 3.8%)
34 Borrowed funds
Bank of Uganda : Apex scheme
Bank of Uganda : Agricultural Credit Facility
Agence Francaise de Developpement (AFD)
2012
UShs’ 000 8,170,927
16,532,552
24,703,479
2011
UShs’ 000
36,109
7,860,354
18,735,307
26,631,770
Bank of Uganda (BOU) operates a loan scheme known as the Apex Loan Scheme. Qualifying customers of the Bank
apply for the facility through the bank.
The outstanding balance as at 31 December 2012 was UShs nil (2011: UShs 36 million).
The Government of Uganda through Bank of Uganda set up an Agricultural Credit Facility scheme for the purpose
of supporting agricultural expansion and modernization in partnership with commercial banks. All eligible bank
customers receive 50% financing from the Government of Uganda while the remaining 50% is provided by the
Bank. The outstanding balance as at 31 December 2012 was UShs 8,171 million (2011: UShs 7,860 million). The
Bank does not pay any interest to the government of Uganda. Refunds to the government are made half yearly and
as at 31 December 2012; the last payable instalment will be due on 31 December 2018.
The Bank entered into a financing agreement with Agence Francaise de Developpement (AFD). Under the terms
of the agreement, AFD lent the Bank EUR 7 million over a period of seven years at a fixed rate of 0.6%. Interest is
paid semi-annually with 12 equal principal re-payments beginning in January 2011. The outstanding balance as at
31 December 2011 was UShs 16,532 million (2011: UShs 18,735 million).
The Bank complied with all the terms and conditions of each of the agreements during the year.
35 Other liabilities
Uganda Revenue Authority - tax payable
Bills payable
Unclaimed balances
Sundry creditors
Unearned fees & commission income
Dividend payable
Provisions for losses
Other liabilities
96
2012
UShs’ 000
4,314,213
71,166,914
23,438,563
24,497,211
4,917,335
3,969,282
1,450,134
11,992,703
145,746,355
2011
UShs’ 000
1,904,458
70,675,566
19,924,723
5,073,655
7,588,678
2,729,569
1,991,886
11,747,364
121,635,899
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
36 Subordinated debt
As at 31 December 2012
Bonds
Floating rate notes
Fixed rate notes
Subordinated loan facility - Standard Bank
South Africa
As at 31 December 2011
Floating rate notes
Fixed rate notes
Subordinated loan facility - Standard Bank
South Africa
Date of issue 10 August 2009
10 August 2009
31 October 2011
Date of issue 10 August 2009
10 August 2009
31 October 2011
The Bank issued subordinated floating and fixed
rate notes in August 2009 of an aggregate nominal
amount of UShs 30 billion. The Subordinated Notes
constitute direct, unconditional, unsecured and
subordinated obligations of the issuer which (a) rank
pari passu among themselves and (b) are subordinated
to the claims of all senior creditors.
The interest rate on the floating rate notes is the 182
day Treasury bill rate + 150 basis points and re-prices
every six months. The fixed rate notes attract a 14.5%
interest rate.
The notes are redeemable on 10 August 2016. The
difference between the carrying and notional values
represents accrued interest.
On 31 October 2011, the bank entered into an
agreement with Standard Bank of South Africa Limited
(SBSA), under which SBSA undertook to lend the bank
USD 7 million (the loan). The loan is unsecured and
subordinated to the claims of all senior creditors.
Carrying value UShs’ 000 28,195,000
1,992,099
30,187,099
Notional value
UShs’ 000
28,195,000
1,992,099
30,187,099
18,925,416
18,792,229
49,112,515
48,979,328
UShs’ 000 28,195,000 1,810,233 30,005,233
UShs’ 000
28,195,000
1,810,233
30,005,233
17,499,700
17,376,333
47,504,933
47,381,566
The loan is for a period of up to 10 years but with a
first redemption date of 31 October 2016.
The interest rate applicable on the loan is variable
and is priced at 3 months LIBOR (London interbank
offer rate for 3 months USD deposits) plus a margin
of 3.76% per annum. After the first redemption date,
the margin increases to 5.025% per annum until
termination.
The Bank complied with all the terms and conditions of
each of the agreements during the year.
37 Dividends
At the annual general meeting to be held in May
2013, a dividend of UShs 1.37 per share amounting
to UShs 70 billion in total is to be proposed. (2011:
total dividend per share of UShs 4.88 amounting to
UShs 50 billion).
The payment of dividends is subject to withholding tax
at rates depending on the tax status or residence of
the recipient.
97
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
38Off-balance sheet financial instruments, contingent liabilities and
commitments
In common with other banks, the Bank conducts business involving acceptances, letters of credit, guarantees,
performance bonds and indemnities. The majority of these facilities are offset by corresponding obligations of
third parties. In addition, there are other off-balance sheet financial instruments including forward contracts for
the purchase and sale of foreign currencies, the nominal amounts for which are not reflected in the statement of
financial position.
Contingent liabilities
Acceptances and letters of credit
Guarantees and performance bonds
Commitments
Commitments to extend credit
Currency forwards
Commitments to purchase property, plant and equipment
Operating lease commitments
2012
UShs’ 000
59,866,616
161,819,874
221,686,490
238,314,664
(4,877,500)
20,183,666
253,620,830
475,307,320
2011
UShs’ 000
86,000,661
85,788,165
171,788,826
274,443,789
70,489,250
21,860,871
366,793,910
538,582,736
Nature of contingent liabilities
An acceptance is an undertaking by a bank to pay a bill of exchange drawn on a customer. The Bank expects most
acceptances to be presented, and reimbursement by the customer is normally immediate. Letters of credit commit
the Bank to make payments to third parties, on production of documents, which are subsequently reimbursed by
customers.
Guarantees are generally written by a bank to support performance by a customer to third parties. The Bank will
only be required to meet these obligations in the event of the customer’s default.
Commitments to lend are agreements to lend to a customer in future subject to certain conditions. Such
commitments are normally made for a fixed period. The Bank may withdraw from its contractual obligation for the
undrawn portion of agreed overdraft limits by giving reasonable notice to the customer.
Foreign exchange forward contracts are agreements to buy or sell a specified quantity of foreign currency, usually
on a specified future date at an agreed rate.
Tax dispute
The bank had been in a dispute with URA that had been pending in the Commercial court for hearing and
determination for some time.
The subject of dispute between Stanbic Bank and the URA was a VAT assessment on management fees of UShs
6.8 Billion for the periods 2003 – March 2009. The main argument against the assessment was that guidance had
been issued by URA on the treatment of VAT on management fees and the bank complied with this guidance, hence
URA was stopped from changing its position. Further, a portion of the management services rendered related to
financial services which in the meaning of the VAT Act are exempt supplies.
98
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
38 Off balance sheet financial instruments, contingent liabilities and commitments (continued)
The issue of URA being bound by earlier positions on a matter was recently decided upon by the Court of Appeal in
a similar case and it was held that “although in normal circumstances, the doctrine of estoppel would apply where a
person makes a misrepresentation that is believed by another who acts upon it to his or her detriment, there is no
estoppel against a statutory provision”. Following the Court of Appeal ruling and advice from the bank’s lawyers, the bank opted for an out of court
settlement and a consent judgement agreed upon by both the bank and URA was executed by court, where
the bank paid the principal amount of the assessment UShs 3.2 billion and the URA vacated all the interest and
penalties assessed of UShs 3.6 billion.
Pending litigation
The Bank is a litigant in several other cases which arise from normal day to day banking. The directors and
management believe the Bank has strong grounds for success in a majority of the cases and are confident that they
should get a ruling in their favour and none of the cases individually or in aggregate would have a significant impact
on the Bank’s operations.
The directors have carried out an assessment of all the cases outstanding as at 31 December 2012 and where
considered necessary based on the merits of each case, a provision has been raised. In aggregate the total
provisions raised amount to UShs 3.5 billion (2011: UShs 2.5 billion).
39 Analysis of cash and cash equivalents as shown in the statement of cash flows
Cash and balances with Bank of Uganda
Cash reserve requirement
Government securities maturing within 90 days
Placements with other banks
Deposits from group companies
2012 UShs’ 000 507,437,302 (179,880,000) 284,824,916 223,595,642 50,548,733 886,526,593 2011
UShs’ 000
409,323,334
(154,220,000)
4,713,648
46,516,392
251,060,604
557,393,978
For the purposes of the statement of cash flow, cash and cash equivalents comprise balances with less than 90
days maturity from the date of acquisition including: cash and balances with central banks, treasury bills and other
eligible bills, and amounts due from other banks.
40 Related party transactions
The Bank is 80% owned by Stanbic Africa Holdings Limited, which is incorporated in the United Kingdom. The
ultimate parent and controlling party of the Bank is Standard Bank Group Limited, incorporated in South Africa.
There are other companies which are related to Stanbic Bank Uganda Limited through common shareholdings or
common directorships. These include Standard Bank London, Standard Bank Isle of Man Limited, Standard Bank
of South Africa, CfC Stanbic Bank Kenya Limited, Stanbic Bank Tanzania Limited, Stanbic Bank Botswana, Stanbic
International Uganda Limited, Stanlib, Stanbic International Insurance Limited and Liberty Life Assurance Uganda
Limited.
In the normal course of business, current accounts are operated and placings of foreign currencies are made with
the parent company and other group companies at interest rates in line with the market.
99
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
40. Related party transactions (continued)
Amounts due from group companies
Placements and borrowings
Other assets
Amounts due to group companies
Deposits and current accounts
Other liabilities
Subordinated debt due to group companies
Subordinated loans (see note 36)
Interest income earned
Interest expense paid
Trading income
Operating expenses incurred
2012
UShs’ 000
45,063,360
5,485,373
50,548,733
328,545,813
16,308,791
344,854,604
18,925,416
2,069,887
5,448,786
2,077,085
17,871,184
2011
UShs’ 000
250,808,011
252,593
251,060,604
110,317,385
2,997,434
113,314,819
17,499,700
2,143,634
2,485,582
16,262,108
Advances to customers at 31 December 2012 include loans to directors and loans to employees as follows:
As at 1 January
New directors appointed
Loans extended during the year
Loan repayments during the year
2012
UShs’ 000
5,513,351
277,137
(2,164,478)
3,626,010
2011
UShs’ 000
8,862,865
73,320
1,191,335
(4,614,169)
5,513,351
Companies affiliated to directors and key management are Pepperoni Pickles Uganda Limited, Uganda Batteries
Limited, Nice House of Plastics, Jesa Farm Dairy Limited, Victoria Seeds Limited and Impala Heights Ltd.
At 31 December 2012 advances to employees amounted to UShs 639 million (2011: UShs 1,163 million).
Loans granted to non executive directors and their affiliates are granted at commercial rates while those granted
to executive directors and executives are: Mortgage – 50% of prime rate, staff miscellaneous and car loans – 75%
of prime rate, study loans – 0%.
Interest income from key management loans
2012
UShs’ 000
51,082
51,082
No impairment has been recognised in respect of loans advanced to related parties (2011: nil).
100
2011
UShs’ 000
138,160
138,160
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Notes
40. Related party transactions (continued)
Deposits by key management and related parties
As at 1 January
Net increase for the year
Key management compensation
Salaries and other short term employment benefits
Post employment benefits
Directors remuneration
Directors fees
Other emoluments included in management compensation
2012
UShs’ 000
511,245
(74,958)
436,287
10,043,742
731,509
10,775,250
473,206
4,743,256
5,216,462
2011
UShs’ 000
340,628
170,617
511,245
9,539,566
389,840
9,929,405
283,204
3,632,399
3,915,603
41 Equity-linked transactions
Share-based payments
Equity compensation plans
Standard Bank Group (SBG) has two equity-settled schemes, namely the Group Share Incentive Scheme and the Equity
Growth Scheme. The Group Share Incentive Scheme confers rights to employees to acquire ordinary shares at the value of
the SBG share price at the date the option is granted. The Equity Growth Scheme was implemented in 2005 and represents
appreciation rights allocated to employees. The eventual value of the right is effectively settled by the issue of shares
equivalent in value to the value of the rights.
The two schemes have four different sub-types of vesting categories as illustrated by the table below:
Year
% vesting
Expiry
Type A
3, 4, 5
50, 75, 100
10 Years
Type B
5, 6, 7
50, 75, 100
10 Years
Type C
2, 3, 4
50, 75, 100
10 Years
Type D
2, 3, 4
33, 67, 100
10 Years
A reconciliation of the movement of share options and appreciation rights is detailed below:
Option price
Number of options
range (ZAR)
Group Share Incentive Scheme
31-Dec-12
Options outstanding at beginning of the period
31-Dec-12
31-Dec-11
310 650
238 000
-
Transfers in
62,39 - 111,94
40 850
Transfers out
62,39 - 111,94
(52 600)
-
-
91 250
Granted
Lapsed
Exercised
Options outstanding at end of the period
62,39 - 111,94
(28 150)
-
62,39 - 98,00
(21 900)
(18,600.00)
248 850
310 650
The weighted average SBG share price for the year was ZAR 110,03 (December 2011: ZAR 98,66).
101
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
41. Equity-linked transactions (continued)
The following options granted to employees had not been exercised at 31 December 2012:
Option price
range (ZAR) 65,60
Number of ordinary shares
500
Weighted
average price
65,60
Year to 31 December 2015
Option expiry period
1 200
79,50
79,50
Year to 31 December 2016
4 700
98,00
98,00
Year to 31 December 2017
30 200
92,00
92,00
Year to 31 December 2018
41 000
62,39
62,39
Year to 31 December 2019
77 500
111,94
111,94
Year to 31 December 2020
93 750
98,80
98,80
248 850
Year to 31 December 2021
The following options granted to employees had not been exercised at 31 December 2011:
Number of ordinary shares
1 000
Option price range
(Rands) 65,60
Weighted
average price
65,60
Year to 31 December 2015
Option expiry period
2 300
79,50
79,50
Year to 31 December 2016
18 600
98,00
98,00
Year to 31 December 2017
24 000
92,00
92,00
Year to 31 December 2018
61 000
62,39
62,39
Year to 31 December 2019
112 500
111,94
111,94
Year to 31 December 2020
91 250
310 650
98,80
98,80
Year to 31 December 2021
Appreciation right
price range (ZAR)
31-Dec-12 31-Dec-12 94 300
98 800
95,80 - 111,94
25 000
-
Transfers out
62,39 - 98,00
(56 000)
-
Exercised1
62,39 - 92,00
(5 000)
(4,500)
58 300 94 300
Equity Growth Scheme
Rights outstanding at beginning of the
period
Transfers in
Rights outstanding at end of the period2 1.
Number of rights
31-Dec-11
During the year SBG 935 (December 2011: 463) shares were issued to settle the appreciated rights value.
At 31 December 2012 the group would need to issue 12 971 (December 2011: 17 473) SBG shares to settle
the outstanding appreciated rights value.
2.
102
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
41. Equity-linked transactions (continued)
The following rights granted to employees had not been exercised at 31 December 2012:
65,60
Weighted average
price (ZAR)
65,60
4 500
79,50
79,50
Year to 31 December 2016
2 500
98,00
98,00
Year to 31 December 2017
17 050
92,00
92,00
Year to 31 December 2018
18 250
62,39
62,39
Year to 31 December 2019
15 000
111,94
111,94
Number of rights
1 000
58 300
Price range (ZAR) Expiry period
Year to 31 December 2015
Year to 31 December 2020
The following rights granted to employees had not been exercised at 31 December 2011:
Number of rights
11 000
Price range
(Rands) 65,60
Weighted average
price (Rands)
65,60
Expiry period
Year to 31 December 2015
13 000
79,50
79,50
Year to 31 December 2016
7 500
98,00
98,00
Year to 31 December 2017
39 800
92,00
92,00
Year to 31 December 2018
23 000
62,39
62,39
94 300
Year to 31 December 2019
42Subsequent events
There was no significant event to report.
103
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder analysis
Top 10 shareholders as at 31December 2012
Number of
shares
Percentage
shareholding
40,950,935,760
80.00
1,576,747,040
3.08
National Social Security Fund
954,806,815
1.87
Ruparelia Sudhir
329,153,630
0.64
Central Bank of Kenya Pension Fund
206,709,680
0.40
Kabanda Kironde Ibulaimu
202,691,120
0.40
Crane Bank Limited
152,503,325
0.30
Duet Africa Opportunities Fund IC
99,373,460
0.19
Kenya Airways Ltd - Staff Provident Fund
96,540,000
0.17
Duet Victoire Africa Index II IC
85,931,680
0.19
Name
Stanbic Africa Holdings Limited
HSBC - Arisaig Africa Fund Ltd
Key shareholder information
Stanbic Uganda is majority-owned by Stanbic Africa
Holdings Limited (SAHL), which is a private limited liability
company incorporated in the United Kingdom. SAHL is,
in turn, wholly-owned by Standard Bank Group and is the
vehicle through which Standard Bank Group holds its
interests in several banks in African countries.
Standard Bank Group is a public limited liability company
incorporated in South Africa and is listed on the JSE. It is the
largest South African banking group by market capitalisation
and by assets and earnings. Standard Bank Group had total
assets of over ZAR 1,544 billion (approximately USD 167
billion) at 31 December 2012 and employs more than
46,000 people worldwide.
Standard Bank Group, which was founded in 1896 in South
Africa, trades as Standard Bank in South Africa, Namibia,
Mauritius, Mozambique and Swaziland and as Stanbic Bank
throughout the remainder of the African continent. It has
104
wide representation, which spans 17 African countries and
21 countries outside of Africa and has an emerging markets
focus.
While its principal activities are banking and related financial
services, Standard Bank Group has diversified its operations
to meet the demands of the fast changing and demanding
business world, with investments in insurance, wealth
management and investment management. It provides a
wide range of banking and related financial services.
In April 2011, Stanbic Uganda entered into a franchise
agreement with Standard Bank Africa a division of The
Standard Bank of South Africa Ltd. under which Stanbic
Uganda was given an exclusive licence in Uganda to
operate the franchised business (as defined in the
agreement) render the services and use the business
system (as defined in the agreement) subject to the
terms and conditions of that agreement and the
applicable law.
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder information
Chairman’s letter to shareholders
Dear
shareholder
I extend an invitation to you to attend the annual
general meeting (AGM) of Stanbic Bank Uganda
Limited to be held at the Kampala Sheraton Hotel on
20 May 2013 at 11:00am.
This is your opportunity to meet and question
members of the Stanbic Bank Uganda Limited board
regarding the company’s performance for the year
ended 31 December 2012.
If you are not able to attend the AGM, I would
urge you to complete and submit the proxy form in
accordance with the instructions and return it to the
address indicated.
I also urge shareholders who have not yet opened
securities accounts with the Securities Central
Depository (SCD) for the deposit and safe keeping
of their shares to do so. Only shareholders who have
immobilised their shares in the SCD can trade them.
Explanatory note on resolutions to be
tabled at the AGM
The AGM will deal with the following ordinary business:
• to receive the annual financial statements for the
year ended 31 December 2012 as required in
terms of the Companies Act;
• to declare a dividend;
• to elect directors in place of those retiring in
accordance with the provisions of the company’s
articles of association. The company’s articles
of association make provision for the annual
retirement of a certain proportion of the board of
directors. Those directors retiring in terms of this
provision as well as directors appointed for the
first time to the board since the previous AGM,
offer themselves for re-election. Their abridged
curriculum vitae have been included in the notice;
• to appoint external auditors;
• in line with the company’s articles of association
you will be requested to approve the nonexecutive directors’ fees in respect of 2013, which
have been considered by the Board Compensation
Committee and recommended by the board;
I look forward to meeting you at the AGM.
Hannington Karuhanga
Chairman
105
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder Information
Notice to members
Notice is hereby given that the annual general meeting (AGM) of Stanbic Bank Uganda Limited will be held at the
Kampala Sheraton Hotel on 20 May 2013 at 11:00am for the following business:
Agenda
1. To receive the annual financial statements for the year ended 31 December 2012, including the reports of the
directors and auditors.
2. To declare a dividend for the year 2012.
3. To confirm the appointment of a new director and elect directors in place of those retiring in accordance with
the provisions of the company’s articles of association.
Mr. Hannington Karuhanga, Dr. Samuel Sejjaaka and Ms Babara Mulwana retire by rotation while Mr Patrick
Mweheire is required to retire at the AGM following his appointment. All being eligible offer themselves for
re-election.
The directors retiring by rotation are independent non-executive directors.
4. To approve the appointment of external auditors of the company for 2013.
5. To approve the proposed fees payable to the non-executive directors for 2013.
• Chairman of Stanbic Bank Uganda Limited – UShs 104,742,000 per annum
• Director of Stanbic Bank Uganda Limited – UShs 36,811,500 per annum
• Board audit committee - chairman - sitting allowance of – UShs 25,806,000 per annum
- member - sitting allowance of – UShs 13,282,500 per annum
• Board risk management committee
- chairperson - sitting allowance of – UShs 16,176,000 per annum
- member - sitting allowance of – UShs 10,626,000 per annum
• Board credit committee
- chairman - sitting allowance of – UShs 11,870,760 per annum
- member - sitting allowance of – UShs 9,775,920 per annum
• Board compensation committee
- chairman - sitting allowance of – UShs 5,935,380 per annum
- member - sitting allowance of – UShs 4,887,960 per annum
• Fee for engagement on Bank business outside board meetings – UShs 611,160 per event subject to
approval of the board chairman
The reason for this resolution is to grant the company the authority to pay fees to its directors for their services as
directors. The proposed fees will be effective from 1 January 2013 and paid quarterly in arrears. In determining the
proposed remuneration, the board considered,
• the level, extent and nature of the non-executive directors’ legal and regulatory oversight responsibilities;
• the time demanded of non-executive directors in attending to Company matters;
• the level of risk assumed by the non-executive directors in performing their duties;
• changes in the cost of living as a result of inflation; and
• reviews of comparative remuneration offered by other major Ugandan and international banks.
106
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder Information
Notes
1 Details of directors
Directors’ details as required by the Listing Rules of
the Uganda Securities Exchange Limited (“the Listing
Rules’) are set out on page 8 of the annual report that
accompanies this notice of annual general meeting
(“the Annual Report”).
2 Directors’ responsibility statement
The directors, whose names are given on page 8 of
the Annual Report, collectively and individually accept
full responsibility for the accuracy of the information
given in the Annual Report and certify that to the best
of their knowledge and belief there are no facts that
have been omitted which would make any statement
in the Annual Report false or misleading, and that
all reasonable enquiries to ascertain such facts have
been made and that the notice contains all information
required by law and the Listing Rules.
3 Interests of directors
The interest of the directors in the share capital of the
Company are set out on page 37 of the Annual Report.
4 Major shareholders
Details of major shareholders of the Company are set
out on page104 of the Annual Report.
5 Share capital of the Company
Details of the share capital of the Company are set out
on pages 37 of the Annual Report.
6 Material change
There has been no material change in the financial or
trading position of the Company and its subsidiaries
since the date of publication of the Company’s annual
results on 18 March 2013.
Stanbic Bank Uganda Limited shareholders may
attend, speak and vote at the annual general meeting
or may appoint one or more proxies (who need not
be shareholders of the Company) to attend, speak and
vote at the annual general meeting on behalf of such
shareholder. A proxy form is attached to this notice
of annual general meeting. Duly completed proxy
forms must be returned to the share registrars of the
Company or the registered office of the Company at
the addresses set out below, to be received by not
later than 5:00pm on Thursday 16 May 2013.
On behalf of the board
Gertrude Wamala
Company Secretary
15 April 2013
Registered office
Crested Towers, Short Tower
17 Hannington Road
Kampala, Uganda
PO Box 7131
Kampala, Uganda
Fax: +256 41 4230608/636 4207
107
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder Information
Share registrar
Deloitte (Uganda) Ltd
3rd Floor, Rwenzori House,
1 Lumumba Avenue, Kampala
P O Box 10314
Kampala, Uganda
Telephone: +256 414 343850
Fax: +256 414 343887
Bond registrar
Stanbic Bank Uganda Limited
Crested Towers, Short Tower
17 Hannington Road
Kampala, Uganda
PO Box 7131
Kampala, Uganda
Fax: +256 41 4230608 636 4207
108
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder Information
Proxy form
Stanbic Bank Uganda Limited
(Registration number P.525)
(“the Company”)
A shareholder entitled to attend and vote at the annual general meeting is entitled to appoint one or more proxies to attend, speak and vote in his/her stead. A proxy need not be a member of the Company.
I/We ___________________________________________________________ (Name in block letters)
of ____________________________________________________________(Address in block letters)
being a shareholder(s) and the holder(s) of _________ ordinary shares of UShs. 1 each and entitled to vote
hereby appoint
1 __________________________________________________________________or, failing him/her
2 __________________________________________________________________or, failing him/her
the Chairman of the annual general meeting,
as my/our proxy to vote for me/us and on my/our behalf at the annual general meeting of shareholders to be
held at Kampala Sheraton Hotel in the morning, and at any adjournment thereof as follows:
Number of votes
for*
Number of votes
against*
Abstain*
Ordinary resolution to:
1. Receive the annual financial statements
2. Declare a dividend
3. Elect directors:
3.1 Hannington Karuhanga
3.2 Samuel Sejjaaka
3.3 Barbara Mulwana
3.4 Patrick Mweheire
4. To approve the appointment of
PricewaterhouseCoopers as auditors of
the Company.
5. Approve non-executive directors’
remuneration
* Insert a cross or tick or number of votes. If no options are marked, the proxy can vote as he/she deems fit.
Signed at ____________________________on _______________________________________2013
Assisted by (where applicable) (State capacity and full name) _____________________________________
Please provide contact details:
Tel: ( ) _________________________________________
Fax: ( ) _________________________________________
e-mail: _________________________________________
Please read the notes on the next page
109
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
Shareholder Information
Notes
1 A shareholder may insert the name of a proxy or
the names of two alternative proxies of his/her
choice in the space provided. The person whose
name stands first on the proxy form and who is
present at the annual general meeting will be
entitled to act as proxy to the exclusion of those
whose names follow.
2 To be effective, completed proxy forms must be
lodged by not later than Thursday 16 May with
either the share registrars or the registered office:
Registered address
Crested Towers, Short Tower
17 Hannington Road
Kampala, Uganda
PO Box 7131
Kampala, Uganda
Fax: +256 41 4230608/636 4207
Share registrars
Deloitte (Uganda) Ltd
3rd Floor, Rwenzori House,
1 Lumumba Avenue, Kampala
P O Box 10314
Kampala, Uganda
Telephone: +256 414 343850
Fax: +256 414 343887
3 The completion and lodging of this form of proxy
will not prevent the relevant shareholder from
attending the annual general meeting and speaking and voting in person at the annual general
meeting instead of the proxy.
110
4 The Chairman of the annual general meeting may
accept or reject any proxy form which is completed and/or received other than in compliance
with these notes.
5 The signatories must initial any alteration to this
proxy form, other than the deletion of alternatives.
6 Documentary evidence establishing the authority
of a person signing the proxy form in a representative capacity must be attached to this proxy
form unless previously recorded by the Company.
In the case of a corporation, a resolution of the
board or equivalent body shall be required.
7 Where there are joint holders of ordinary shares:
(a) any one holder may sign the proxy form; and
(b) the vote of the senior shareholder (for that
purpose seniority will be determined by the
order in which the names of the shareholders
who tender a vote (whether in person or by
proxy) appear in the Company’s register) will
be accepted as to the exclusion of the vote(s)
of the other joint shareholders.
Contact details
Chief Financial Officer
Arthur Oginga
Tel: +256 41 7154396
Company Secretary
Gertrude Wamala Karugaba
Tel: +256 41 7154336
Investor Relations Enquires
Tel: +256 41 7154337
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
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111
Stanbic Bank Uganda Limited. A financial institution regulated by Bank of Uganda. License Number A1. 013
Stanbic Bank Uganda Limited Annual report
For the year ended 31 December 2012
112
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114
Stanbic Bank Uganda Limited Annual report 2012
www.stanbicbank.co.ug