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Capital: What challenges did you face over the last two years in the realization of such an establishment and how did you overcome them?
Fasika Kebede: There are a lot of challenges you face when you make forays into any undertaking. Ours was no exception to the rule. Since we started floating shares, it took us quite some time to get where we are now because of the tight competition of raising capital in the market.
Capital: Was the competition from other banks that floated shares or was it in convincing prospective shareholders of the merits of buying shares in banking institutions as compared to other business ventures?
Fasika: We can consider both. About five banks had floated shares which made the competition tough. Only ours [Enat Bank] and Debub Global Bank SC made it to the final stages. Other banks that undertook the under-formation process were unable to go ahead with their plans because of these reasons and I think they are changing their plans to embark on projects to establish other businesses which require lesser capital and have relatively less stringent regulations and procedures.
Capital: You have declared that your bank has come up with initiatives for new kinds of services. Could you elaborate on some of them?
Fasika: First of all, the bank will provide all the customary and conventional banking services. However, in addition to these services, we have come up with innovative services, which will especially concentrate on the provision of loans for startup companies and on different ways of boosting the bank’s savings accounts and other banking services. For example, children can now open accounts at our bank. This would allow the younger generation to understand and appreciate the value of saving money from an early age and develop a tendency of depending less, especially when it comes to monetary matters, on others. It would also help parents and guardians teach the culture of saving to their children in a world where such things have become very important.
The other type of service we came up with is the one we offer to the youth of our country. Enat is dedicated and will take the initiative to encourage and aid the youth in financial planning. In doing so, we will be helping them save money in accordance to their future plans and into their retirement age. Of course, we know that there is a countrywide pension scheme, which everybody can acquire, including employees of private companies. However, to increase the worth of that income, they have to start planning at a very early stage for a much better future. We encourage people to have a better life in the future by saving more today. The service depends on an individual’s income, interest and plan of saving. But, we will sit down with young people and advise them on how to do just that.
We also have another premium account for those who cannot save large funds. Depending on the savings, we will pay premium interests. That is also negotiable and subject to individual decisions- not as one group. These are some of the deposit services we are offering right now.
Later on, when we move into providing loans, we will have other services. For the time being, we are concentrating on deposits. Capital: What are the values of Enat Bank?
Fasika: Our values are centered on the care we offer our customers; we are a trustworthy bank. I am not saying in any way that other banks are not trustworthy. I just want to underline or emphasize that, as the name we chose for the bank indicates, our concern and care for our clients is and will continue to be like a mother’s [Enat] and special attention will be provided to all comers. Basically, Enat bank will possess the characteristics of a mother.
Capital: Therefore, you think people should both buy shares and use your unique services because of the characteristics and qualities you have just stated?
Fasika: Yes, I believe all should choose us because of the outstanding services we are offering, and in a very friendly environment indeed. When you come to Enat Bank, you would feel at home. An easy, relaxed and accessible environment has been set up for discussing all financial and related issues. We believe it certainly is a very conducive environment for customers. We are also very flexible towards our customers to satisfy their needs and meet their requirements.
Capital: The Ethiopian banking sector is said to be tough, with very strict regulations in lending quota, bond buying, tax windfalls and an increased capital requirement. However, private banks are registering and reporting very strong profits and paying high dividends. What is your take on that?
Fasika: The capital requirement has increased to 500 million birr. This has become one of the primary prerequisites for entry into the banking sector. As I said earlier, there were several banks under formation before this requirement became law. When the capital requirement became higher, some I believe, decided to change track and began looking to invest in other business ventures. Increased capital requirement is now the major difficulty that new entrants into the sector face. But those banks which joined the sector before the increment in capital requirement have made, and are making, huge sums of money. Therefore, that the sector is very profitable is not in doubt. When we see the overall growth in the country’s Gross Domestic Product (GDP), an increase in population size and the number of banks currently operating, there is an acute demand for the establishment of additional banks, because there are a lot of people who will be needing the services that banks provide, especially in light of the continuous intellectual advancement in the society in the business sense. The existing potential is the reason for realizing higher profits.
Capital: How does the increased capital requirement affect your bank?
Fasika: We are still selling shares in the market. We have opened the bank now and since the official commencement of the bank’s operation, we have observed that the number of buyers of our shares is significantly increasing. Other banks are also subject to increasing their capital, either through the profits they make or through the sale of shares. What we have to do is sell more and more shares and make a lot of profit to increase our capital to 500 million birr by June 30, 2016.
Capital: How much are you worth currently?
Fasika: Our paid up capital is 120 million birr and the subscribed capital is 260 million birr. The total capital then would be 380 million birr with shareholders numbering about 7,200. We believe we can increase our capital to 500 million to meet our deadline.
Capital: In its entirety, what are the bank’s future plans?
Fasika: Our major aim is to be customer friendly and continue to be quite innovative. We want to carry on having new products and services to fulfill the demands of our customers and, at the same time, we will be opening new branches in different parts of the country. We will start by having additional branches in Addis. We will have two levels of branches; one will be a full-fledged branch and the other will be a small branch, which would be supported by the bigger branch. We are providing one window service now and, after a year, we would move into high-tech banking technology, which will provide us with the opportunity for additional delivery channels, and so on. We are aspiring to be a high-tech banking service provider.
Capital: What should people expect after five years from Enat Bank?
Fasika: After five years, we expect our bank to somehow be highly competitive and an equivalent service provider to its peer group, if not more.
Capital: How many employees does the bank currently have?
Fasika: The bank has a staff of about 55 for the two branches that have commenced operations. The number of employees will increase when the third branch opens its doors to the public very soon. We are already engaged in the process of recruiting employees for the third branch. We are giving a one-month long training for professionals to help them understand the values of our bank and the way its operations will be conducted. Our training is very rigorous and up to the required standards, but it will take some time though. As we open up other branches in the country, we will continue recruiting personnel for them.
Capital: You are the third woman who has become the president of a banking institution in the country. What is your considered opinion in the capabilities of women to shoulder the responsibilities required for any such ventures?
Fasika: You know what? Enat [mother] is the most responsible person who manages huge households even though she is not considered the head of the family in many cultures. If a woman is capable of being responsible for the raising of her children in addition to taking care of her spouse, and if we add to this the benefits of education, experience and exposure, then my considered opinion is definitely that women are extremely capable in managing all kinds of business ventures, public institutions and private organizations, and manage them quite effectively, I would say.
Therefore, I certainly believe that the number of women who will become bank presidents is going to increase with the development of the country as a whole.