Zemen Bank got back on track during the last fiscal year, reversing the previous year's disappointing meagre profit growth by registering 81pc growth in net profit .

Last year, the Bank netted 489.8 million Br profit - boosting earnings per share by 112 Br to 398 Br, news that delighted shareholders. Two years ago, Zemen's profit ticked up by only two percent.

Abebe Dinku (Prof.), board chairperson of the Bank, remarked in his statement to shareholders that Zemen achieved the promising performance despite the challenges in the economy.

"Although the country has been experiencing economic growth, the overall macroeconomic imbalances remain challenging," he wrote, "and we've witnessed and [been] confronted by major obstacles during the year."

A surge in external debt, inflation, a widening of the trade deficit mainly due to poor export performance, the government budget deficit and exchange rate instability were the major obstacles mentioned by the board chairperson.

The surge in all income activities helped the Bank to amass the huge profit. Interest on loans, advances and NBE bonds increased by 42pc to one billion Br, while income from fees and commissions swelled by 39pc to 446 million Br. Income from foreign exchange dealings also went up by 14pc to 111.8 million Br.

The management of Zemen should be applauded for such achievements, according to Abdulmenan Mohammed, a financial analyst with close to two decades of experience.

The main focus of Bank officials was credit management and controlling non-performing activities, as well as focusing on international banking services, according to Dereje Zebene, president of Zemen, which commenced operations in October 2008.

The Bank's expenses have also soared, however, at a lower rate than the growth in income. Interest paid on deposits grew by 20pc to 531.2 million Br, while personnel and other operating expenses surged by 28pc to 416.3 million Br.

Abdulmenan cautioned the management to closely follow personnel and other operating expenses.

The new 17 branches opened in the reporting period and recruitment of new employees were the causes for the spike in expenses, according to the president.

"Zemen is also working on purposive human capital development," said Dereje.

In the last financial year, Zemen disbursed loans and advances of 7.6 billion Br, an increase of 52pc. It mobilised deposits of 11.6 billion Br, an increase of 14pc. The loan-to-deposit ratio of Zemen increased to 65pc from 48.8pc.

"The growth in the ratio is remarkable," said Abdulmenan. "The Bank has some room to increase its loan-to-deposit ratio, but it should take extra caution when doing that.”