Though shareholder returns remain lower, Addis International Bank, one of the late entrant banks, had an impressive financial performance last year, raising its profit by 46pc.

The profit growth of Addis, which netted 167.2 million Br, is more than double the industry average, which stands at about 20pc. The earnings per share (EPS) of the company went up by about three Birr to 20.7 Br.

Considering the young age of the Bank, the performance of Addis is satisfactory, according to Abdulmenan Mohammed, a financial statement analyst.

The considerable increase in the total income of the Bank contributed to the growth in profit after tax. Interest on loans and investments in the NBE bond reached close to 407.8 million, showing a 41pc increase. Service charges and commissions went up by 36pc to 216 million Br.

However, income from foreign exchange dealings showed a slight decline by one percentage point to 30.7 million Br.

Even though the forex earnings of the Bank is better than some banks, Hailu Alemu, president of Addis, says it is still less than their expectations.

“The forex crunch in the economy posed a huge challenge to the banking sector as a whole,” Hailu told Fortune.

In tandem with the remarkable growth in total income, the Bank’s expenses also increased markedly at about the same rate as that of income. The total expenses of the Bank increased by 37pc to 463.7 million Br.

Interest paid on deposits showed the highest rate of increase by 54pc, reaching 208.1 million Br.

The higher interest rates the Bank paid on time deposits was the reason for this, according to Hailu.

"We were paying 12pc to 13pc on time deposits, since we did not have a strong base in the current or deposit accounts that required much lower interest rate payments," Hailu said.

Salaries and benefits also rose to 124.5 million Br, showing a 29pc growth, while general administration expenses spiked by 20pc to reach 119 million Br.

In a bid to attract competent and qualified human resources to be more profitable in the industry, Addis increased salaries of employees, according to the President.

"We also recruited additional staff members for the new branches we opened," Hailu said.

In the reported period, the Bank opened nine new branches, pushing its total branch network to 68.

As Addis is relatively new to the industry, the expansion of expenses is expected, according to Abdulmenan.