Two of Equity Group Holdings Subsidiaries, Equity Bank Uganda and Equity Bank South Sudan have weathered Covid-19 disruption to register 84% and 62% in Profit After Tax respectively.
The increase, according to the group comes on the backdrop of exports and imports growing in Q3 in Uganda suggesting that both foreign and domestic demand strengthened in the period amid a further easing of restrictions. In Q4, the private sector activity was at its highest level since the breakout of the pandemic, highlighting a sharp improvement in business conditions as further restrictions were removed.
Consequently, output continued to expand, leading to higher employment levels and auguring well for private consumption in turn.
In South Sudan, the group attributes the growth to a key partnership with the International Monetary Fund in Q4 2020 that saw the Republic of South Sudan receive a $52 million emergency disbursement under the Rapid Credit Facility to help its economy weather the shock arising from the pandemic.
Projections by the group through its FY20 investor statement reveal that South Sudan has great potential for more growth if it diversifies its economy away from oil with large investments in infrastructure, human development, and stronger institutions. The country’s economy rebounded in 2019, with growth estimated at 5.8%attributed attributed to increased oil supply following the reopening of oil fields and resumption of production.
“The previous global pandemic was the Spanish Flu which occurred in 1919, a century back, and hence the world had lost its memory and had to re-learn, adapt and adjust making 2020 an exceedingly difficult and challenging year. Our corporate purpose of ’Transforming lives, giving dignity and expanding opportunities for wealth creation’ became the guiding compass of the organization’s essence on how to navigate through the crisis and the challenging environment. Our results and performance became a human story of resilience and determination to live an ethical human purpose.”
Dr, James Mwangi – EGH Managing Director and Chief Executive officer
A rise in profits in the two subsidiaries also comes at a time when the group is rebranding its regional subsidiaries to reflect a “global” brand and a much-changed operating environment after the group’s 35 years of existence.
The rebrand has seen the subsidiaries adopt more youth-targeted products and services and becoming more mobile and digital. As a result, customers are increasingly showing a preference for self-service banking.
With the development of COVID-19 vaccines and the world embracing vaccination, the Group is optimistic that the health crisis caused by COVD-19 will in time be brought under control.
Besides the two subsidiaries, the entire group weathered the COVID-19 disruption to register a 51% growth in its balance sheet with total assets growing to Kshs 1.015 billion (One trillion and fifteen billion shillings) up from Kshs 674 billion the previous year.