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Ethiopia: Buna Bank Sell Shares to Employees

One of Ethiopia’s private banks, Buna International Bank (BIB), decided to sell shares to its employees who worked for at least two years. The intention behind the decision is to keep the employees and also motivate them.

The decision to sell shares for the staff was passed by the board of directors that is chaired by Marshal Fekeremarkos. The suggestion came from the management of the bank requesting to sell shares for employees who have worked at least two years at the bank, Eshetu Fantaye, president of the Bank, explained.

According to Eshetu thus far 160 employees have bought 90,000 shares that are worth nine million Birr. They bought the shares with their provident fund. They purchased the shares from a minimum shares at par value and a maximum of two percent of the capital.

Employees of BIB save seven percent of their salary to the provident fund while the bank 13 percent into the fund. Nonetheless, this arrangement is not applicable to employees who are hire after the promulgation of the proclamation that brings private institute employees under the pension scheme.

Buna was established in 2009 with a paid up capital of 156 million Birr and 308 million Birr subscribed capital. Currently it has a total of 11,600 shareholders. By the end of December its asset has rose to 3.5 billion Birr and extended 1.9 billion Birr. Its deposit in the other hand reached 2.7 billion Birr.

According to Fortune, the bank availed 125 million Birr worth of shares in the 2013/2014 fiscal year. In additional to this on October 25, 2014 the general assembly decided to put forward 75 million Birr worth of shares in the current fiscal year.

Source: Fortune