By our staff reporter
Shareholders of Berhan Bank expressed their dissatisfaction with the low dividend yield for the recently concluded financial year. At the bank’s 14th regular general meeting of shareholders held on December 1, attended by over 16,000 shareholders, it was reported that the bank achieved a 15.6 percent earnings per share (EPS), equivalent to 156.2 birr per share. However, regulatory authorities at the central bank downgraded the EPS to 6.03 percent due to non-performing loans (NPLs) and other deductions.
The bank’s board of directors faced heavy criticism for proposing dividends of less than 7 percent for the 2022/23 financial year. Shareholders voiced their discontent, stating that the current situation was unacceptable. Some shareholders expressed their frustration, noting that they have been experiencing declining returns for consecutive years, and the decrease from 7 to 6 percent only added insult to injury.
One shareholder complained about the lack of change year after year in the bank’s performance, suggesting the presence of corruption tendencies. They believed that they were receiving significantly less compared to shareholders of other banks.
Another concern raised by shareholders was the construction of a 5,400 square meter head office building in Addis Ababa, known as Senga Tera, as well as the planned construction of another building in Wolaita Sodo town. Shareholders argued that the prolonged construction phase of these projects was tying up capital and affecting the bank’s financial position.
The bank’s report for the 2022/23 financial year highlighted the negative impact of economic and political instability both domestically and globally on its performance. Gumachew Kussie, the Chairman of the Board of Directors, acknowledged that earnings had declined due to “unprecedented” factors. He further stated that despite the lack of stability, the bank achieved a profit of 605.2 million birr before tax, representing a 3.7 percent increase compared to the previous year.
Girum Tsegaye, the bank’s president, reported that the deposit stock reached 33.8 billion birr, while the loan stock peaked at 28.9 billion birr for the 2022/23 period.
