BoA ascends in profit despite surge in expenses

Bank of Abyssinia (BoA) has registered massive profits, while its expenses have surged by 1.3 billion birr in the ended financial year.
The bank that has been in operation for the past 25 years has stated that its revenue for the 2019/20 financial year boosted to about 5.7 billion birr with one third increment compared with the 2018/19 financial year.
In its report that was disclosed on the general assembly held on Thursday November 19, the revenue shows an additional 1.4 billion birr earning compared with the preceding year. The expense has also skyrocketed by 1.33 billion birr, which is a 40.6 percent increment compared with the 2018/19 financial year expense.
In the reported year, the bank’s total expense has been almost 4.6 billion birr. “The interest fee that follows the expansion of deposit and depositors, salary and benefit of staffs, administrational cost including rent and costs on technology development are the major reasons for spiking the expense,” the Bank of Abyssinia said.
From the total expense, the salary and benefits of staff and interest fee took the lion’s share of 39.8 and 38.4 percent respectively. Regarding administration and rent expense the bank that opened 166 new branches in the 2019/20 financial year has allocated huge amount of cost for rent and furnishing of the new branches.
The bank has managed to double the number of depositors in the ended financial year that reached at 2.6 million with 103 percent increment.
The total deposited in the stated period has also surged to 47.6 billion birr by an incline of 48 percent from the preceding year. In the year, additional 15.5 billion birr has been mobilized as saving that have additional 1.2 billion birr compared with the projection.
The bank loan and advance has also climbed by more than half compared with the 2018/19 financial year. In the 2019/20 financial year the loan and advance has reached to more than 37 billion birr with 57 percent increment compared with the preceding year.
In the year, the bank has generated USD 400 million with 17 percent increment, while it was less by USD 104 million compared with the projection. In the stated period, BoA had expected to generate more than half a billion dollar.
In the reported financial year, the company’s gross profit before tax stood at more than one billion birr with six percent increment compared with the preceding year.
The gross profit after tax reached 853 million birr with an increment of 76 million birr compared to the 2018/19 financial year.
The earnings per share for the year have stood at 7.2 birr which was 7.23 a year ago.
The financial firm’s total capital has reached 5.68 billion birr with 14.7 percent increment, while the paid up capital increased by 12 percent and stood at 3.15 billion birr.
The bank asset has reached close to 57 billion birr a hike of 45 percent compared with the 2018/19 performance.