Global Bank Grows, So Does the Price of Its Ambition

Jun 14 , 2026. By NAHOM AYELE ( FORTUNE STAFF WRITER )

The Bank appeared to be getting stronger, larger, and more ambitious, but was still searching for the efficiency and earnings power that separate a growing bank from a durable franchise.

Global Bank Ethiopia entered the last financial year as a mid-tier lender in an industry being reshaped by heavier capital rules, heightened competition for deposits and an increasingly explicit regulatory push toward stronger balance sheets.

It ended the year bigger, better capitalised and more visible. It also ended the year with a sharper version of the dilemma facing much of the private banking industry. Growth is possible, but not cheaply.

Its shareholders saw a stronger financial institution and a higher payout, while the numbers showed a bank paying more for deposits, carrying more capital, and still seeking productivity gains, even as larger competitors often set terms first.

According to Yoseph Getachew, the board chairperson, the year “met shareholders’ expectations.”

The Bank’s assets expanded by 42pc to 34.43 billion Br, deposits climbed by 41pc to 25.75 billion Br, the largest annual increase in the Bank’s history, and loans and advances reached 20.38 billion Br after a 4.67 billion Br increase.

Profit after tax jumped by 56pc to 756.6 million Br, while gross profit increased to 998.7 million Br from 757.5 million Br.

Its last year’s performance was consistent with its five-year growth trend, during which its assets grew from 11.63 billion Br to 34.43 billion Br. Deposits almost tripled, from 8.7 billion Br to 25.75 billion Br. The Bank’s paid-up capital grew from 1.39 billion Br to five billion Birr, enabling it to meet the National Bank of Ethiopia’s (NBE) requirement before the June 2026 deadline.

For Tesfaye Boru (PhD), president of the Bank, this came from “strategic growth and steadfast resilience amid a dynamic economic landscape.”

The Bank operated through regulatory tightening, geopolitical uncertainty, macroeconomic volatility and a flexible foreign-exchange regime. Yet the clearest pressure came from funding.

Interest income increased to 4.27 billion Br from 3.11 billion Br, while interest expense grew faster to 2.64 billion Br from 1.63 billion Br. The Bank incurred nearly 62 cents of interest expense for every Birr of interest income earned, compared to 34.6 cents for the industry average. Net interest income increased only modestly to 1.63 billion Br from 1.48 billion Br.

Global Bank gathered deposits and expanded credit, where mobilisation has become more competitive and expensive. Interest paid on fixed deposits surged from 1.01 billion Br to 1.82 billion Br, revealing greater dependence on costly term money than on cheaper savings and demand deposits.

Aminu Nuru, the Doha-based financial analyst, saw the risk.

“The Bank is becoming more dependent on fixed deposits, which is making its funding more expensive and reducing profit from lending,” he told Fortune.

Habtamu Tadegegn, the Bank’s director for Corporate Strategy, acknowledged the pressure but argued that interest expense is unavoidable where depositors expect compensation.

The Bank’s management is trying to shift toward lower-cost funding sources. That shift will decide whether growth becomes durable or merely expensive.

Total revenue reached 5.56 billion Br, up from over four billion Birr. More than three-quarters came from interest income, while fees and commissions contributed 16pc and other operating income seven percent.

Non-interest income helped protect the bottom line. Fee and commission income increased to 883.45 million Br from 741.30 million Br. Other operating income increased to 400.59 million Br from 245.58 million Br, helped by foreign-exchange dealings and revaluation gains, which generated 283.2 million Br, up from 153.4 million Br.

Global Bank mobilised 112 million dollars in foreign currency, up by 13pc. International fund transfers accounted for 63pc of the total, the interbank market 20pc, exports 16pc and cash purchases one percent.

Its return on assets (ROA) was about 2.2pc, above the 11-bank peer weighted average of 2.1pc. It stood close to Oromia Bank and ahead of Coop, Amhara, Sidama and Hibret banks, but far below Addis Bank at 9.32pc, Ahadu Bank at 3.97pc, Berhan Bank at 3.55pc, and Abay and Wegagen banks at about 3.28pc.

However, its return on equity (ROE) was less flattering, remaining at about 11.5pc, down from 13.6pc a year earlier and below the industry averages.

With its capital doubled to five billion Birr, and total equity rising to 6.6 billion Br from 3.57 billion Br, Global Bank was safer. Its capital-to-asset ratio was about 19.2pc, above the peer weighted average of 12.5pc. Its asset-to-equity multiple of about 5.2 times was far below the peer average of eight times.

This gives Global Bank a loss-absorbing cushion. In an uncertain economy, analysts saw that as prudent. But in an inflation-prone economy, it is not enough.

Scale remains another constraint for the Bank, whose asset base of 34.43 billion Br left it smaller than Amhara, Anbesa, Berhan, Oromia, Wegagen, Abay, Hibret and Coop banks. Coop Bank’s assets, at 197.35 billion Br, were nearly six times larger, while Hibret Bank’s 113.93 billion Br balance sheet was more than three times larger.

Deposits tell the same story. Global Bank’s 25.75 billion Br deposit base was ahead of Addis, Ahadu and Sidama banks, but below Amhara Bank’s 31.49 billion Br, Anbesa’s 44 billion Br, Berhan’s 44.45 billion Br and Wegagen Bank’s 66.5 billion Br.

Mulugeta Gezahegn, a project office manager at Securities Exchange & Investment Bank and one of more than 22,000 shareholders, praised profitability and dividend stability but questioned cost control and branch expansion.

“There are banks that report losses,” he said. “The fact that our Bank remained profitable and still paid shareholders a dividend is encouraging.”

The branch network revealed this tension. The Bank had 237 branches at year-end, after opening 12. Of these, 59pc, are in Addis Abeba. The deposit per branch was about 108.7 million Br, below the peer average of 150 million Br.

Digital banking was the counterweight, with the Bank’s digital transaction value nearly doubling to 4.78 billion Br from a year earlier and from only 37 million Br in 2022/23. Mobile, USSD, and internet banking users exceeded half a million, while cardholders reached 74,772, with transactions totalling 709.9 million Br.

The test was whether digital channels lower costs, improve deposit retention, lift fee income and reduce branch-led mobilisation. Permanent staff fell by three percent to 2,212. Yet, personnel expenses jumped to 1.05 billion Br from 944.18 million Br, while other operating expenses fell to 381.17 million Br from 404.08 million Br. Profit per employee was 342,000 Br, above the average of 310,655 Br among its peers.

Earnings per share (EPS) increased to 230 Br from 213 Br, and the Bank paid a dividend of 230 Br a share, up nearly eight percent. Total comprehensive income increased to 834.3 million Br from 499.9 million Br. But shareholders will want proof that the new capital base can deliver higher, more sustainable returns.

Abate Kisho, once president of the Southern Regional State and now in the coffee sector, is a founding shareholder of Global Bank Ethiopia. He believes the Bank is improving but remains below peer performance levels.

“It’s on a better path,” he told Fortune, “but it’s still not operating at its full potential.”

Abate attributed periodic cash shortages at branches and criticised digital banking interruptions that affected customer experience.

Cash and bank balances totalled 4.91 billion Br. After excluding the 1.4 billion Br reserve requirement at the Central Bank, adjusted cash equivalents fell to 3.51 billion Br, 13.6pc of deposits. The Bank ended the year with no borrowings, compared with 1.19 billion Br a year earlier. But net cash outflow from operations deepened to 5.83 billion Br from 3.27 billion Br, offset by 8.48 billion Br of financing inflow.

That makes depositor confidence central. The Bank’s loan-to-deposit ratio of about 79.1pc was above the peer weighted average of 73.5pc. It was close to Wegagen and Amhara banks, though below Hibret and Anbesa banks.

Its interest-free banking (IFB) offers one route to deposit diversification. Global Bank operated eight branches dedicated to IFB and IFB windows at conventional branches. IFB customers increased by 54,327 to 297,920, while IFB deposits nearly doubled, surpassing half a billion Birr. Murabaha financing and pre-shipment Qard services displayed a fuller product line.

According to Aminu, Global Bank’s credit risk is not alarming but requires attention.

International trade accounts for 38pc of loans, domestic trade and services for 30pc, and manufacturing for 12pc. Together, these sectors account for roughly four-fifths of lending.

The Bank’s stage-3 non-performing loans (NPL) exposure was 401.4 million Br against gross loans of 20.38 billion Br, signalling an NPL ratio of 1.97pc, far below the industry’s average ratio of 3.1pc. The early-warning signal is stage-2 exposure (loans not yet non-performing, but showing rising credit risk) of 966.8 million Br, comprising 4.74pc of loans.

Private banks have long relied on working-capital finance, trade-linked lending and transaction flows from importers, exporters and service businesses. That left Global Bank exposed to foreign-exchange allocation shifts, import compression, customs delays, export settlement cycles and traders’ cash-flow stress.

Aminu cautioned that rapid loan expansion could expose the Bank to future credit risk.

“Aggressive lending can eventually lead to higher non-performing loans if not managed carefully,” he said.

The impairment charge increased by 20.6pc to 59.6 million Br, still well below loan growth.

Guarantees issued were 13.05 billion Br, while loan commitments were about 997.9 million Br. Total maximum off-balance-sheet exposure was around 14 billion Br, equal to 69pc of gross loans and 41pc of total assets.

Global Bank’s performance was strong, but not without pressure points. It grew fast, met the paid-up capital requirement early, nearly tripled deposits over five years, expanded assets, lifted net profit by more than half, and pushed digital transactions sharply higher.

However, deposit costs climbed rapidly, net interest income grew much more slowly than interest income, operating cash flow remained negative, and the loan book remained concentrated in trade and services. These were not signs of weakness, but main areas to watch.

Addressing shareholders gathered at the Adwa Memorial Museum in December last year, the Chairperson closed the general assembly with the slogan, “Our bank for ‘Our shared success’.”

For shareholders, 2024/25 gave substance to that message.

PUBLISHED ON Jun 14,2026 [ VOL 27 , NO 1363]