Bunna International Bank netted 440.3 million Br in profit during the last fiscal year, a 4.6pc decline from the year before. The Bank's earnings per share (EPS) also receded by 21.6pc to 225 Br.

The reduction in EPS has been caused by a decline in profit after tax combined with a fresh capital injection, which reached 2.2 billion Br, recording a 22.4pc rise from the previous year.

This must be disappointing news to the shareholders, according to Abdulmenan Mohammed, a financial statement analyst.

Aklilu Tesfa, a founding shareholder at Bunna, was discontented with the profit decline. He says that he bought shares at the Bank convinced by the promoters' great vision of reaching out to people with low income. He then joined the Bank with 10,000 Br worth of shares, and the value tripled after extra investments including from the dividends he receives.

"The Bank's expense is increasing year on year, while profit and return for the shareholders remain consistent," said Aklilu, who was unhappy with the proposal for a raise in board remuneration made during the general assembly that was held last month.

The financial statement of the Bank shows that the decline in fees and commissions and in gains from foreign exchange dealings coupled with a significant increase in expenses were the main culprits behind the reduction of profit after tax.

Sewale Abate (PhD), the board chairperson of Bunna, also echoed the wane in foreign currency earnings as a cause for the profit decline.

The Novel Coronavirus (COVID-19) pandemic and the social and political unrest in the country were also challenges to local and international economic activities, according to Sewale.

“Due to these [issues], the amount of foreign currency the Bank mobilised has shown an 18pc reduction,” he remarked, “this by default resulted in a decline in the attended profit.”

Bunna's gains on foreign exchange dealings decreased by 32pc to 52.5 million Br, while fees and commissions dropped by six percent to 390 million Br. However, income from interest on loans, advances, NBE bonds, treasury bills, and other deposits surged by 30.8c to 1.7 billion Br. Other income also increased by five percent to 60.6 million Br.

Mulugeta Alemayehu, CEO of Bunna, also stated that the management made a strategic decision to carry out a financial restructuring aimed at driving organic growth.

"In this process, we expected a profit decline," he said. "But we'll get the desired results after completing the process."

Expenses at Bunna have also spiked. Interest on deposits rose by 23pc to 542 million Br, while personnel expense grew by 32.6pc to 532 million Br. Other operating expenses reached 444.4 million Br, a whopping 40.7pc surge.

Over the past year, the Bank has managed to open 37 branches, of which one-third of them were in the capital. It currently has 242 branches operating with 2,043 employees, 665 of whom were hired in the reporting period.

The significant increase in expenses undermined the revenues generated by the Bank, leading to reduced profit after tax, according to Abdulmenan.

Mulugeta argues that the rise in expenses might not always be alarming. He says the rise of expenses on interest shows that the Bank has mobilised a higher amount of resources.