Zemen Bank reports a 33 percent increase in after-tax profits and

delivers a 36.7 percent earnings per share return to shareholders

·         Revenues and Profits reach highest levels since the Bank’s founding

·         Assets up 34 percent, Deposits up 44 percent, Loans up 33 percent

·         Earnings per share averages 40 percent per year over the past five years

(December 8, 2016) Zemen Bank announces today that it earned a pre-tax profit of Birr 270 million in the 2015-16 fiscal year based on audited financial results.  After-tax profits reached Birr 203 million compared to Birr 153 million last year, equivalent to a growth rate of 33 percent.  With these financial results, the Bank provided its shareholders with earnings per share of 36.7 percent in FY 2015/16.  The Bank continued its record of delivering strong to its shareholders, as seen from the five-year average earnings per share return of 40 percent per year. The Bank’s financial results in 2015-16 reflected a macro-economic setting that presented a mix of opportunities and challenges.  The demand for banking services—especially loans—remained high even though Ethiopia’s economic growth during 2015/16 was 8 percent (according World Bank’s economic update) compared to 10.2 Percent during the previous year.

In the context of the above, the Bank is pleased to report that it has registered moderate growth in most areas of its activities.  The  overall asset base of the Bank rose by 34 percent and is now close to Birr 7.4 billion, or near USD $335 million.  Deposits rose significantly from Birr 3.8 billion to Birr 5.4 billion, a growth rate of 44 percent.  The increase of loans and advances increased from Birr 2.2 billion to birr 3.4 billion, showing a 33 percent increase.  Despite challenging macroeconomic conditions, foreign exchange inflows increased by USD 66 million to reach USD 302 million from just USD 236 million in the past year. This translates to a 28 percent increase which is the ever highest since the establishment of the Bank. The Bank also showed a sound financial standing in key areas: the capital adequacy ratio stood at 27 percent of risk-weighted assets much higher than the regulatory requirement of 8 percent. The liquidity ratio of 40 percent showed a similarly comfortable position surpassing the regulatory minimum of 15 percent. As before, the Bank continued to make sizeable contributions to the broader national economy, with its purchase of government securities (NBE Bills) now standing at Birr 1.6 billion and its tax payments for the year reaching a record high of Birr 67 million.  

Beyond financial metrics, Zemen Bank’s activities in 2015-16 were marked by a continued broadening of our multiple service delivery channels.  In line with our careful and limited expansion of physical service points, and reflecting also our plans to be present in business areas and regional cities, the Bank opened three new banking centers in Addis Ababa around CMC, Piassa and Old Airport. In addition, Humera Banking Center was also inaugurated during the just finished fiscal year, adding to a total of twelve branches and six sub-branches. The fiscal year also saw the continued expansion in our alternative service delivery channels—through more ATM deployments, an improved Internet Banking system, a new mobile banking offering (using both SMS and IVR channels), and continued growth in our highly valued and corporate-focused services such as Doorstep Banking.

The Bank’s Annual Report is available to its shareholders and the general public on its website at http://www.zemenbank.com/reports-publications