Addis International Bank, one of the late entrants to Ethiopia’s finance market, registered an impressive 46 percent growth in profit and managed to generate 85.3 million Birr in the past fiscal year. The earnings per share has also increased by 3.2 percent and reached 193 Birr for a thousand Birr share.
However, compared to the highest earnings per share in the market, Dashen Bank’s, Addis’ performance is 2 times lower.
Commenting on the earnings per share of Addis, Abdulmenan Mohammed Hamza, an analyst at London Portobello Ltd., said “The EPS growth is encouraging despite a massive increase in paid-up capital”.
Currently the Addis’ market share stands below 2 percent and it has not made any significant improvement when compared to 2014/2015 fiscal year.
Commenting on the performance, the Bank’s board chairman, Hailemelekot Teklegiorgis, said Addis’ performance was worth applause despite stagnant market share. According to the chairman, the challenges the bank faced during the last fiscal year were shortage of foreign currency, skyrocketing office rent, severe competition in deposit mobilization and the pressure to meet the minimum capital requirement.
In the past fiscal year, out of the entire earnings by Addis 150 million Birr was from interest on loans and investment in NBE bond. The bank’s income from foreign exchange dealing, on the other hand reached 25 million Birr after taking a lip of 30 percent.
Addis’ expense also grew in the past year by 42 percent and reached 182 million Birr. Interest paid on deposit has also increase by 52 percent and reached 63 million Birr.
In the aim of increasing its market share, the bank has opened 9 branches last year. This took the bank’s total number of branches to 40.
According to Fortune, currently there are 8,370 shareholders that own 532,580 shares. The majority shareholders are Ethiopian Airlines employees’ Saving & Credit Cooperatives, Addis Ababa Saving & Credit Cooperatives Union, the Ethiopian Roads Authority Employees’ Saving and Credit Cooperative, ethio Telecom Employees’ Saving and Credit Cooperative and Yirgachefe Coffee Farmers Cooperative Union.
The bank’s paid up capital has now reached 516 million Birr, exceeding the half a billion Birr requirement set by the National Bank of Ethiopia. Currently it is only Debub Global Bank that has now met requirement set central bank.
Source: Fortune
