Development Bank of Ethiopia Profit Rises 26.3%

Development Bank of Ethiopia has earned a net income of 491 million Ethiopian birr during the 2011/12 fiscal year. The Banks annual report, which was approved by its board of directors in Bahir Dar last week, indicates, it has surpassed its target of approving 7.9 billion birr worth of loans.

The largest portion of the approved loans was for companies engaged in the industrial sector. The industrial sector has received 5.8 billion birr in total, 143 percent higher than what the bank has targeted to loan out to the sector. Foreign companies, such as Saygin Dima, which got over one billion birr of loans approved last year, were the major beneficiaries.

The agricultural sector, however, received only 17 percent of the total loans approved, receiving 1.3 billion birr. This amount is 57 percent below the Bank’s target. The report also shows, the Bank’s loan collection rate hit 99 percent of the 2.57 billion Br target. However, the Bank has not yet to reached its desired Non Performing Loan (NPL) ratio of 5.62pc. The figure now stands at 8.62pc.

The Development Bank of Ethiopia is a government owned bank. The Bank gives long-term loans at an interest rate of 8.5 percent to projects involved in priority areas, such as agriculture, industry and extractive industries.

Source: Fortune

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