Dfcu Limited has posted its first half-year profit decline since 2022, weighed down by rising operating expenses and increased provisions for bad loans, according to the company’s latest financial disclosures.
For the six-month period ending June 30, 2025, dfcu’s profit after tax dropped to UGX 34.5 billion, representing an 18.5% fall compared to the same period in 2024. The company’s pre-tax profit also slid 22%, impacted primarily by a sharp rise in operational and credit-related costs.
Operating expenses climbed 18.8% to UGX 150.4 billion, driven by inflationary pressures and expansion-related outlays across its banking operations. Notably, dfcu Bank, the group’s largest subsidiary, reported a UGX 9.5 billion loan impairment charge, in contrast to the prior year’s UGX 6.9 billion provision reversal.
Despite the profit drop, dfcu recorded positive trends in core banking metrics. Net interest income grew 17% year-on-year to UGX 199.6 billion, reflecting a rebound in lending activity and improved interest margins. For the first time in five years, net loans and advances to customers rose, reaching UGX 1.2 trillion, up 16.8% from the same period last year.
This growth marks a significant turnaround from H1 2024, when loans and advances had declined by 12.6%.
The group’s latest performance comes after a strong full-year result in 2024, when dfcu reported a 151% increase in net earnings, driven by operational efficiencies and digital banking innovations under its “Fired Up” strategy. However, the H1 2025 results suggest a more cautious outlook as the lender navigates cost headwinds and credit risk adjustments.