Despite declines in foreign exchange transactions, Enat Bank, one of the youngest private banks, increased its profit by more than 40pc aided by a massive boost in investment income.

In the last fiscal year, Enat netted 158.8 million Br in profit, a 42pc increase from the previous year. This helped the bank's earnings per share, with a par value of 1,000 Br, to grow by 16 Br to 184 Br.

The earnings per share have grown despite a considerable increase in paid-up capital. Enat, which was established as the 16th private bank when it became operational in March 2013, increased its paid-up capital by 27pc to 971 million Br.

Enat’s financial performance for the last fiscal year is characterised as solid, according to Hanna Tilahun, board chairperson of Enat, who recently replaced the founding chairperson, Meaza Ashenafi, who moved to become the Chief Justice of the Supreme Court.

“Taking into consideration the lack of favourable economic situations in the country,” remarked Hanna, “we consider it as positive that we maintained profitability and a return on equity.”

Established with a subscribed and paid-up capital of 260 million Br and 120 million Br, respectively, Enat reported mixed results in income-generating activities. The Bank did well in financial intermediation operations and other services, while earning from foreign exchange transactions have fallen.

"Income generated from interest on loans and advances helped us to show a good performance," said Wondossen Teshome, president of Enat.

"It accounted for 72pc of the total income, he told Fortune."

Interest on loans, investments in National Bank of Ethiopia bonds and time deposits increased by 61pc to 489.61 million Br, and service charges and commissions grew by 24pc to 246.54 million Br. However, income from foreign exchange transactions dropped by 40pc to 10.14 million Br.

"Even though income from foreign exchange dealings dropped across banks the decline at Enat is concerning," Abdulmenan Mohammed, a financial statement analyst, said.

Wondossen shares the expert's opinion. "Last year, we were stuck in generating foreign exchange."

Wondossen attributes stringent requirements by the central bank in forex allocation as the primary reason for the disappointing result.

The central bank’s direction, which compels all banks to provide forex for anyone who applies for foreign currencies, has severely affected the bank, according to the president.

“Most of our clients who have been generating forex switched to other banks, due to this procedure," Wondossen told Fortune.

A massive expansion in expenses accompanied growth in income.

Enat spent 312 million Br in interest on savings, an increase of 56pc, 118 million Br in salaries and benefits, an increase of 43pc, and 99.3 million Br in other operating expense, an increase of 24pc.