Wegagen Bank, one of the 16 private commercial banks, has become the third bank, along with Awash and Dashen banks, to pass the one billion Birr mark in gross profits reported in its filings for the last fiscal year.

Its net profit increased by 53pc to 793.5 million Br, and its earnings per share of 365 Br surpass the industry average by 31pc.

The new strategy the bank implemented, branch expansion and resource mobilization, are the major factors attributed to the bank’s positive performance, according to Araya G. Egziabher, president of the Bank.

“We have been implementing a performance evaluation system for the past three years,” Araya told Fortune.

Wegagen Bank underwent a restructuring program that introduced a competency-based human resource framework three years ago.

Shareholders welcome the performance of the bank.

“The bank has performed well,” said Thomas G. Mariam, one of the 3,198 shareholders of the Bank. “I’m delighted with my returns.”

The Bank also performed well in financial intermediation. The income from loans, the National Bank of Ethiopia's bonds and bills, and other deposits reached 2.1 billion Br. When compared with its prior year performance, it showed a 57pc increase.

Wegagen earned a little less than one billion Birr from forex, service charges and commissions.

“We have been endeavoring to increase remittances and empower the export sector,” Araya said.

The increase in income came with a surge in expenses.

The interest paid to savings soared by 61.1pc to three-quarters of a billion Birr. Last fiscal year, Wegagen mobilised deposits of 20.06 billion Br, which it paid at least seven percent interest on. The salary and benefits expenses of the bank have also expanded. It spent 677 million Br for its 4,163 employees with adjusted salaries and benefits.

“To retain our staff, we have increased the benefits and salary,” said Araya.

Wegagen also opened an additional 64 branches in the past fiscal year which increased the administration cost.

The Bank was able to disburse roughly 74pc of its 20 billion Br in deposits and gained a loan-to-deposits ratio above the industry average of 67pc.

The provision for doubtful loans, advances and other assets reached 88.7 million Br.