Wednesday, November 5, 2008

Ethiopian Private banks declare profit

The Reporter, 01 November 2008

Lulseged Teferi, president of Dashen Bank now asking himself that the profit trend will keep up?

Dashen Bank bags a record 239mln birr profit

By Hayal Alemayehu

Dashen Bank’s profit reached a record 239.1 million birr both for the bank itself and for the over-a decade-old private banking industry as a whole, according to the bank’s board of directors report released on Thursday at the Sheraton Addis. The profit the bank secured is 28.3 percent higher than what the bank made during the previous year, according to the report.

The record profit has literally astounded the bank’s president who, upon reporting the bank’s last fiscal year performance ended last June 30 said he asked himself if that trend would continue.

“When the bank made a net and record profits of about 133 million birr and 188 million birr in 2005/2006 and 2006/2007, respectively, the shareholders were asking: Will that trend keep up?” Lulseged Teferi said. “Now I am asking myself that question.”

The bank made a gross profit of 332.5 million birr and paid over 93 million birr for government in taxes, the report indicated. During its 14 years of operation, the bank paid a total of 326 million birr in taxes, according to the report.

The bank’s overall assets reached 7.8 billion birr during the reported period, registering a 1.8 billion birr increase from that of the previous year, the report indicated. The number of deposit account holders at the bank has reached 487,410, according to the report.

During the reported fiscal year, the bank mobilized a net 413.7 million birr and 1.3 billion birr in loans and deposits, respectively.

The president assured shareholders that the loan portfolio of the bank, which indicates whether a given bank’s operation is healthy or not, is sound enough with the level of the non-performing loans (NPLs) against the total loan the bank mobilized standing at 5.9 percent.

Dashen Bank's 5.9 percent NPLs is way below the ten percent mark for banks to be considered health by international standards.

The bank currently shares 27.7 percent of the total deposit mobilized amongst the private banks while the total loans issued by the bank accounts for 26.1 percent the amount mobilized by the eight private banks, according to figures obtained from the National Bank of Ethiopia.

The number of Visa-branded cards issued by the bank has exceeded 34,000, while the bank was able to collect over USD 31 million from the service.

The bank disclosed launching International Money Transfer Service as an agent of MoneyGram in Ethiopia, as of Wednesday. It is also preparing to acquire and issue MasterCard, according to the president.