Nib Bank Profit soars to 113m Br

Nib International Bank (NIB) achieved a record high net profit of over 113 million Br in 2007/2008 fiscal year.

Dembel Balcha (PhD), the temporary chairman of the Board of Directors, announced this to the shareholders during the ninth ordinary and tenth extraordinary general meeting of the shareholders at Sheraton Addis on November 29, 2008.

“Despite the challenges both locally and internationally for business and investment during the fiscal year, gratifying achievements were registered in every area of the bank’s activities,” he said.

The net profit showed an increase by 49pc from the previous year. Total assets, deposits and loans and advances also grew by 40pc, 31.5pc and 16.1pc and reached 3.65 billion Br, 2.47 billion Br and 2.11 billion Br, respectively.

The bank’s aggressive effort to expand its services to customers across the country registered the results its official calls impressive.

As a result, 12 new branches were opened during the fiscal year. Out of these, six are in Addis Abeba, while the remaining are in Harar and Awedai in the eastern part of the country, Emdibir in Guraghe Zone of the southern part, Dessie, Bahir Dar and Metema Yohannes in the northern part.

The expansion raises the total number of branches the bank has across the country to 41, in addition to its two Foreign Exchange Bureaus. Accordingly, NIB is the fourth largest private bank in Ethiopia in terms of the number of branches it runs, next to Awash, Dashen and Abyssinia that have 55, 47 and 45 branches, respectively.

The Star Bank of India and Dubai is currently undertaking NIB Bank’s automation that involves the installation of state-of-the-art IT solutions in a bid to computerize the bank’s entire operations and network its branches.

In the 2007/2008 fiscal year, the bank finalized the first phase of the exercise by bringing four more branches to the network. Accordingly, the total number of networked branches increased to 14. Once the IT work is finished, the bank will be able to launch the card system, its officials said.

NIB claims that such achievements in the year made it win the Best Bank Award of 2007/2008 for Ethiopia by the New York Based Global Finance and UK based Banker.

NIB has currently over 2,954 shareholders and over 1,300 employees.

Amerga Kassa, the bank’s president, told Fortune that NIB’s Non Performing Loans (NPLs) have gone down to five percent from the eight percent last year.

Delighted with the profit, the bank has given an equivalent of two months salary bonus to its employees and raised their salaries by two scales.

“We do this to support our staff cope with the skyrocketing cost of living,” he said.

Last year, the bank paid a 60 Br dividend per share. Though the bank’s profit has hit record high this year, the dividend it distributed to shareholders is up by only one Birr per share.

According to Amerga, the small increase in the dividend is mainly due to the bank’s decision to capitalize the majority of its profit.

Privately owned banks in Ethiopia date back to 1994 and NIB International Bank S.C. was established on May 26, 1999 with a paid up capital of 27.6 million Br by 717 shareholders and now operates with fourty one branches.

As of November 2008, the Bank’s paid-up capital had reached well over 450 million Br.

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