Bank of Baroda Uganda’s net profit rose 24.4 per cent to Shs91.3bn in the six months to June 2026, its highest first-half result since at least 2018. The increase came as interest earned on its assets grew faster than the cost of funding them for a second consecutive first half.

Net interest income rose 22.1 per cent to Shs134.5bn from Shs110.1bn a year earlier. Interest income increased 18.5 per cent, against an 11.8 per cent rise in interest expense. In the corresponding periods of 2023 and 2024, funding costs had grown faster than interest income. Profit growth also accelerated from 22.7 per cent in the first half of 2025.

The bank expanded net loans and advances by 20.9 per cent to Shs1.8tn in the year to June, while its government securities holdings rose 16.1 per cent to Shs1.2tn. Together, those balances increased by Shs473.2bn, compared with Shs269.5bn growth in customer deposits.

Deposits with other financial institutions fell by Shs279bn to Shs217.4bn, while cash and balances with the Bank of Uganda rose by Shs238.4bn to Shs582.2bn. Shareholders’ equity increased by Shs152.9bn to Shs1tn. The accounts do not show whether the fall in interbank placements financed the growth in loans and securities.

The growth in net interest income came as market rates eased. The Bank of Uganda kept its policy rate at 9.75 per cent throughout the first half, while its measure of commercial lending rates fell to 16.9 per cent in June from 19.1 per cent a year earlier. Yields on 91-day and 364-day Treasury bills also declined.

Non-interest income fell 8.8 per cent to Shs12.4bn, a second consecutive first-half decline, while operating expenses eased 1.9 per cent to Shs26bn. A Shs1bn expected-credit-loss credit added to profit, compared with a Shs522mn charge a year earlier. The bank reported Shs687mn in non-performing loans and other assets, up from Shs427mn, while bad debts written off fell to Shs49mn from Shs1.8bn. Its summary accounts do not explain the change in provisions.

Baroda’s net loans grew 20.9 per cent in the year to June, compared with 14.5 per cent growth in lending across Uganda’s commercial banks. Its net loans also rose to 46.2 per cent of total assets from 43.1 per cent a year earlier. Across the banking industry, total loans made up 37.3 per cent of assets in March 2026, down from 40.2 per cent in March 2025, the latest comparable quarters available in the Bank of Uganda’s financial-soundness data.

The Uganda Securities Exchange-listed bank, 80 per cent owned by Bank of Baroda in India, did not recommend an interim dividend.