Board Chairperson’s Message

Dear Shareholders,

It is with great pleasure and sense of pride that I present to you Abay Bank’s annual performance report for the fiscal year just ended, June 30 2021.

The global macroeconomic environment we passed through all last year had been punctuated with the three-wave impacts of the corona virus which has not only inflicted wide ranging damages across the globe but also forced us into adopting a new way of life.  Enduring its sever impacts as it robbed us of our loved ones, damped business and sent families into solitude, it now appears that, with invention of and more access to the vaccine, the world is gradually coming out of the dark casted by the horrible pandemic albeit in a divergent mode of recovery.  IMF’s report labeling part of the year (well into November 2020) as “a year like no other” says it all about the massive consequences it has witnessed.

Almost in a largely similar fashion, the situation in our country had not been any different.  Our country got into an unavoidable war in a mission to inforce law and order in the northern parts of the country and this, coupled with the repressive impacts of COVID-19, has contributed toward a stalled economy and a general slowdown in business.  The economic activity had been hit hard by the slowdown and particularly hotel and tourism, as well as transport sectors were significantly affected.

Just at the close of the fiscal year, the Banking sector has seen a new bank join the industry in the name of a full-fledged Interest Free Bank.  This is known to be tip of the iceberg as there are already well over 20 others in their formation stages a few of which are finalizing their licensing requirements.  It is also in this reporting period that the regulatory organ markedly rose the minimum capital requirement necessary to establish a bank.  The government has also successfully undertaken the initiative to change the national currency notes with new ones in this fiscal year.  The intervention had been a positive contribution and opportunity to the entire sector as money in banks increased markedly and improved security and control was possible by the government.

Abay Bank decorated its tenth year anniversary with a remarkable performance.  The Bank’s achievements against all known industry KPIs had been impressive. Its performance in resource mobilization had seen its total deposits grow by 49% hitting as high as Birr 23.9 billion as at end of the fiscal year.  The financing side had an all the more striking growth with total loans and advances expanding by 72% year-on-year.  The Bank was also able to attract and keep its happy customers which grew by about 46% to reach well above 1.2 million.  It has also markedly expanded its service outlet by opening 63 new branches across the country which took the total count to 286 witnessing a 28% growth upon last year’s position.  What’s more, Abay’s gross profit for the year plunged by a stunning 80% put against last year’s feat and the figure, striding past the one billion mark for the first time, stood at Birr 1.15 billion.

There have been scores of impactful initiatives undertaken by the Bank during the year which meaningfully supported its continuous strive to offer improved services to its esteemed customers.  Revision and implementation of a new organization structure, upgrading of the Core-Banking system, design and implementation of a competitive pay scheme, finalization of the contract agreement for construction of the Bank’s Headquarters building can be mentioned among them.  These wide-ranging endeavors of the Bank had also been reinforced with a strong risk management and compliance practices which were undertaken all year through.  The Bank has also been an active participant in several CSR activities lending a hand to various nationwide initiatives.

Looking ahead, as we conclude the just ended fiscal year with all of us as a nation still to work toward creating a peaceful and stable Ethiopia, and fight against the rise of the ‘third wave’ of COVID-19 which together are poised to impact our national growth trajectory, we shall remain resilient and hopeful to come out at the top of our challenges and stay on course to yet again register commendable achievements.  Despite facing headwinds of various forms, our Bank is determined to perform even better by working to reinforce its growth strategy through enhancing its organizational capability and level of execution with the help and support of all its stakeholders as well as entire Bank’s community.

I would like to congratulate the Board of Directors, shareholders, the Bank’s management team as well as the entire staff for the hard work and effort exerted toward this year’s delightful achievement.  I would also like to take this opportunity to acknowledge the positive impacts and interventions made by the National Bank of Ethiopia in navigating the industry toward a stable and safe banking environment.  My sincere appreciations also goes to our customers and the entire business community who worked with us all year long and helped us serve them better.


Thank you,

Ethiopia Tadesse

Chairperson, Board of Directors

Abay Bank SC