Ethiopia's largest private lender, Awash Bank, achieved record foreign exchange earnings of $1.49 billion in the past fiscal year, signaling continued strength despite challenges facing the country's trade sector.
The East African nation saw overall export proceeds decline from $4 billion to $3.6 billion in 2022/23 as global economic conditions tightened, restricting trade, according to government data. Ethiopia is also struggling with foreign currency shortages squeezing its economy.
Despite this backdrop, Awash Bank generated 20% more foreign exchange than the previous year to set a new high.
"Domestically, Ethiopia's economy in FY 2022/23 faced significant macro-economic challenges including persistent high inflation, insufficient foreign currency reserves, sharp declines in donor financing, and depreciation of the national currency," stated Board Chairman Gure Kumssa.
Company officials attributed the success to attracting and retaining top exporters through strategic partnerships and client-focused services. Loan balances to the export sector swelled 15% to over 31 billion Birr, while import lending rose 5% to nearly 21 billion Birr.
Bank President Tsehay Shiferaw noted factors including “the drop in global commodity prices, illegal trade, security issues, suspension from the African Growth and Opportunity Act (AGOA), etc.” contributed to slowing export earnings nationwide.
Awash registered strong financial results for the fiscal year ending June 2023, highlighting continued business expansion and record profits.
Overall income for Awash Bank increased 39.8% to Birr 28.79 billion, mainly driven by a 54.9% surge in interest income from higher loan balances.
Expenses grew 44.4% to Birr 19.1 billion as the bank added over 4,300 new employees and interest costs climbed 38.5% on deposit growth.
Awash also delivered outstanding bottom-line performance.
Despite macroeconomic headwinds, Awash Bank reported record profits, with profit before tax up 9.8% to Birr 9.8 billion. Earnings per share increased to 577 from the previous 570.
Deposits grew 23% to Birr 187.4 billion and total assets expanded 22.3% to Birr 224 billion, supported by loans which were up 25% and hit Birr 162 billion. Non-performing loans remained low at 1%, underscoring strong asset quality.
