Bank Of Uganda has issued PostBank a license to operate as a tier-one commercial bank.
Henceforth, PostBank shall no longer be categorized as a credit institution but as a deposit-taking financial institution that gives loans for consumption and investment to make a profit. The bank can now carry out all the functions and services of commercial banks as stipulated in the Financial Institutions Act (2004)
Some of these services offered by tier-one commercial banks include acceptance of call, demand, savings, and time deposits withdrawable by cheque or otherwise; provision of overdrafts and short to medium term loans; provision of foreign exchange facilities; acceptance and discounting of bills of exchange and provision of financial and investment advice. Others are participation in inter-bank clearing systems and giving of guarantees, bonds or other forms of collateral as well as accepting and placing of third-party drafts and promissory notes connected with operations in which they take part.
Commenting about the historic milestone, PostBank’s CEO/MD Julius Kakeeto said that with the new management’s goal to strengthen PostBank’s foundation, efforts have been put into digital transformations that will improve customer experience. He also said that with these changes at the Bank, it was inevitable that the institution would optimize its potential and ably compete with the aggressive privately owned financial institutions.
“What we have been doing is building the foundation- a solid foundation, because, with a very solid foundation, you can do so many things including competitiveness and growth,” he is quoted saying in the bank’s press statement announcing the award of the license.
In the statement, Mr Kakeeto said that a rigorous restructuring process undertaken over the last two years has given the institution a competitive edge with a new Board of Directors and several top-class bankers joining senior management. This allowed the bank to make a net profit of UGX10 billion in 2020, the highest in the Bank’s history.
This makes PostBank which is 100% owned by the government of Uganda, one of the exemplary and best-performing government parastatals.
“The new management team has focused on improving risk management, strengthening governance, customer experience, enforcing compliance and kickstarting the bank’s digital journey, in addition to capacity building for the workforce,” the bank’s statement said.
“The Bank owes this milestone to its customers, staff, the shareholders and all the external stakeholders who have supported this journey,” the statement further said, adding: “PostBank remains committed to transforming the lives and livelihoods of Ugandans through offering affordable and sustainable financial solutions.”
About PostBank Uganda.
PostBank Uganda (PBU) is a public company limited by shares and formed under the Public Enterprises Reform and Divestiture Statute of 1983 and the Uganda Communications Act, 1997. It was incorporated under the Companies Act in 1998 and is owned by the Government of Uganda with 100% shareholding. PostBank Uganda has since grown to boast of 49 branches countrywide, stretching from Yumbe to Kabale, from Kotido to Masaka, and over 400 Post Agents