Despite sluggish foreign exchange earnings, Lion Bank, one of the 16 private banks, marked a successful financial cycle last year by recording 69pc profit growth.

Last year’s performance of the 12-year-old bank far surpassed the previous year's results when the Bank registered a profit growth of just three percent and a slump in shareholder return.

Last year's profit stood at 390.77 million Br, earning investors 7.55 Br a share with a par value of 25 Br. The shareholders’ return has shown an increase of almost two Birr.

The reason for the performance improvement was the efficiency of the Bank, according to  Getachew Solomon, the fourth president of Lion who assumed the post in 2014.

"We attained efficiency by converting our resources into earning assets," Getachew toldFortune. "We have invested the resources in the areas that generate revenues."

The management of Lion should be applauded for this, according to Abdulmenan Mohammed, a financial statement analyst with a decade and a half experience in the finance and audit industries.

In addition to rising profit, the bank managed to show improved performance by increasing revenues.

Incomes from loan and advance interest and treasury bills of the National Bank of Ethiopia spiked to 1.17 billion Br, while incomes from fees and commissions went up by 14pc to 157.68 million Br.

Even though the Bank managed to register positive performance in increasing income from foreign exchange dealing by five percent to 53.08 million Br, the result is far lower than what it gained two years ago.

The Bank has been hit by a steady decline in earnings from foreign exchange transaction between 2011 and 2014 due to stiff competition, according to Abdulmenan.

But it had managed to reverse the trend for two years until 2016, before declines in earnings from forex returned in 2017, admits the president.

"Honestly, we didn't perform well in generating much foreign exchange in the reporting period," said Getachew. "We were just sharing the forex coming to the country."

Tassew Woldehanna (Prof.), the board chairperson of the Bank and the current president of Addis Abeba University, attributes under performance in the export sector and the chronic foreign exchange shortage as a major headache for the financial sector.

"These were the major challenges that left the banking business in difficult circumstances," wrote Tassew in his annual message to shareholders.

To reverse this trend, Lion should develop a strategy to improve this area of business, according to Abdulmenan.

Getachew agrees.