Dashen Bank achieved strong financial results for the year, with record profits of 4.8 billion birr.
Total deposits grew by 26.9 percent to a record Birr 145.9 billion, boosted by a 27.4 percent jump in customer accounts to 6.71 million. The sizable deposit growth underlines "customers' continued trust" in Dashen despite liquidity constraints facing the industry.
"More than ever before, high regard is attached to customer experience improvement and endeavors are being made to enhance the customer service culture by adopting customized best practices," said Dulla Mekonnen, Board Chairperson of the Bank.
Savings deposits comprised the largest share at 54.8 percent of the total, providing a stable low-cost source of funds.
Sustained Lending Growth Amid Regulatory Cap
Gross loans and advances including IFB financing expanded 14.6 percent to 116.1 billion birr, in line with the central bank's 14 percent credit ceiling. This helped support productive sectors and offset some of the pressures posed by high inflation and foreign exchange shortages.
The banking industry faced numerous headwinds, operating under tight monetary policies and challenging macroeconomic conditions, according to Dashen’s CEO Asfaw Alemu. Persistent liquidity constraints and limited foreign exchange availability further squeezed margins, he said.
Consumer and trade and service loans constituted the largest portions of the diversified portfolio of Dashen.
Strategic Investments Power 26.8% Profit Growth
Pre-tax profits surged 26.8 percent to 6.4 billion birr on a 33.8 percent rise in total revenues to 23.5 billion birr, driven by interest and fee income.
Cost management kept the growth in expenses to 33.3 percent, enabling expansion in net earnings. Returns improved with ROA at 2.7 percent and ROE at 20.4 percent.
The Board of Directors has proposed reinvesting 2.36 billion birr of the company’s net retained earnings into capital and distributing Birr 1.01 billion as dividends to shareholders.
Balance Sheet Strengthened on Capital Injection
Paid-up capital was raised 28 percent to 12 billion birr, boosting total equity 23.9 percent to 23.9 billion birr. This provided a solid platform for balance sheet growth, which saw total assets accelerate 26.9 percent to 183.7 billion birr.
