Ethiopia’s Banking Sector · total new deposits mobilized by private banks (Birr 89bn) exceeded that of CBE (Birr 54bn), while private banks’ collective profits (Birr 17bn) have

Disclaimer: This report represents solely the views, analysis, and judgement of the Cepheus research team and does not necessarily reflect the views or opinions of the Fund’s Managing Partners, Advisors, or Investors.

With provisional 2019-20 results for Ethiopia’s banks recently becoming available, this note reviews the sector’s latest performance, notable trends, and near-term outlook. We find that the banking sector has so far come out of the COVID pandemic in relatively good shape (as has the broader macroeconomy) and that private banks have done particularly well in making market share gains vis a vis the dominant state bank. Looking ahead, however, banks will be facing major policy shifts in the way that Government finances its deficit, sets monetary policy, and determines the exchange rate—while also having to cope with a changing financial sector landscape that will bring many new entrants, additional service offerings, and a wider range of funding sources. These extensive macro-financial reforms should not pose a risk to the banking sector’s historically strong growth record, in our view, but they do imply an increasingly competitive operating environment, a moderation in average shareholder returns, and a greater differentiation in performance across banks. § Recent performance—positive results despite COVID: Ethiopia’s private banks

finished the 2019-20 fiscal year on a sound footing, with deposits up 25 percent, loans up 34 percent, and profits up 21 percent. Average returns to shareholders (EPS) were near 32 percent, not much different from the norms of recent years.

§ Market dynamics: Private banks have steadily increased their market shares in

branch networks, deposits, loans, and profits. For the just-ended fiscal year, the total new deposits mobilized by private banks (Birr 89bn) exceeded that of CBE (Birr 54bn), while private banks’ collective profits (Birr 17bn) have now surpassed—for the first time—that of the state bank (Birr 14bn).

§ Outlook—major shifts in the banking landscape: The sector is set to face major

policy shifts as the Government modernizes its framework for deficit financing, monetary policy setting, and exchange rate determination. Other reforms will bring many more competitors (up to 20 new banks, MFI-turned-banks, leasing companies, fin-techs, specialized service providers, foreign financiers), broaden funding sources (via local bonds and external borrowing), and permit new services (such as capital market offerings). Taken together, these changes in the macro-financial environment will help propel continued banking sector growth but within a much more competitive environment for the established players.

Data Appendix: Revisiting our 2019 Banking Sector Report, we update by one year our compilation of banking statistics and provide a 25-page data appendix covering key sector trends as well as five years of bank-by-bank performance metrics (up to FY 2018-19) for all of Ethiopia’s private banks.

Ethiopia’s Banking Sector

RESEARCH & ANALYTICS

Earnings Per Share, Sector Average, %

31.5%

33.7%

31.2%

28.4%

29.5%

25% 27% 29% 31% 33% 35%

FY 2019-20

FY 2018-19

FY 2017-18

FY 2016-17

FY 2015-16

Private Banks' Profit Market Share, %

54.8%

47.1%

49.1%

42.5%

29.7%

25% 35% 45% 55%

FY 2019-20

FY 2018-19

FY 2017-18

FY 2016-17

FY 2015-16



2

Recent Performance of Private Banks: Deposits, loans, capital, and branch networks § Private banks recorded a strong performance last year across key metrics—deposits, loans, capital, and branches. § Loans rose by nearly Birr 100bn for the year, funded by Birr 87bn in new deposits and Birr 8bn in extra capital. § Branch networks were also significantly expanded, and the total number of private bank branches is now nearly

triple that of the CBE (4,361 private bank branches vs 1,604 CBE branches).

Fig 1: Deposits at Private Banks

Source: Banks Survey data and NBE

92118

147

202

279

360

447

85

135

185

235

285

335

385

435

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Deposits (Birr bns)

Fig 3A: Paid-Up Capital at Private Banks


11 13

16

21

26

33

42

7

12

17

22

27

32

37

42

47

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Paid-Up Capital (Birr Bns)

Total Capital (Birr bns)

Fig 4A: No. of Branches at Private Banks


1,159

1,535

2,008

2,658

3,162

3,734

4,361

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Fig 2: Loans at Private Banks


53 75

91

133

179

251

347

45

95

145

195

245

295

345

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Loans and Advances (Birr Bns)

Fig 3B: Total Capital at Private Banks


1821

2633

44

57

75

0

10

20

30

40

50

60

70

80

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Total Capital (Birr bns)

Fig 4B: No. of Employees at Private Banks


27,324 32,171

37,396

43,574

54,776 58,788

73,509

27,300 32,300 37,300

42,300 47,300

52,300 57,300

62,300 67,300

72,300

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

No. of Employees



3

Recent Performance: Profits, Returns of Assets, and Return on Equity § Despite the COVID pandemic, pre-tax profits rose from 14bn to 17bn, though the latter are still provisional figures

for June 2020. Taking into account effective tax rates for the sector, we estimate after-tax profits will be Birr 13.1bn, implying close to Birr 4bn in tax payments by private banks for the year.

§ Expressed relative to year-average paid-up capital, the profit figures translate into an average Earnings per share (EPS) of 31.5 percent in FY 2019-20, close to the average returns received by shareholders over the last five years.

§ Profits were equal to 2.5 percent of average assets (ROA) and also equal to 29 percent of total capital (ROE).

Fig 7: Return on Average Assets at Private Banks (RoAA)


3.33.1

1.7

2.6

2.82.9

2.5

1.5

1.7

1.9

2.1

2.3

2.5

2.7

2.9

3.1

3.3

3.5

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

RoAA

Fig 5: Profit Before Tax, and Profit After Tax est. at Private Banks


4.7 5.4 5.8

7.6

10.5

14.0

17.0

3.6 4.1 4.5 5.7

8.1

10.7

13.1

3.0

5.0

7.0

9.0

11.0

13.0

15.0

17.0

19.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Profit Before Tax, & Profit After Tax est. (Birr bns)

Profit before tax (Birr bns) Profit after tax est. (Birr bns)

Fig 6: Earnings Per Share at Private Banks


31.1 30.8

29.5

28.4

31.2

33.7

31.5

25.0

26.0

27.0

28.0

29.0

30.0

31.0

32.0

33.0

34.0

35.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Earnings per share (Percent)

Fig 8: Return on Average Equity at Private Banks (RoAE)


20.5 19.7 20.3

17.8

20.2 20.4

28.7

11.0

13.0

15.0

17.0

19.0

21.0

23.0

25.0

27.0

29.0

31.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

RoAE



4

Recent Performance: Underlying sources of strong performance § Last year’s strong results were driven by a greater deployment of mobilized deposits (as loan/deposit ratios rose

sharply), still-sizeable lending spreads (near 7 percent), and on-going declines in banks’ cost-to-income ratios. § Given Ethiopia’s July-June fiscal year, COVID-related shocks were concentrated only in the last quarter, thus

minimizing adverse impacts for the banking sector (as for the broader macroeconomy) over the full fiscal year. § Regulatory forbearance by the central bank—in allowing generous rescheduling terms to be granted to COVID-

affected companies/loans—also helped the banking sector overcome the impacts of the pandemic, though most private banks started from relatively low NPL ratios and loan-loss provisions even before the pandemic.

Fig 9: Loans to Deposits Ratio at Private Banks


57.2

63.4

64.0 64.5

64.1

68.9

77.5

56.0

61.0

66.0

71.0

76.0

81.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Loans to Deposits Ratio (Percent)

Fig 11: Lending rates, deposit rates, and spread at Private Banks

Source: NBE and Banks' Annual Reports

3.2 3.4

5.5

3.94.5 4.8

15.3

10.2 10.5 10.4

11.9 12.012.0

6.8

5.0

6.5

7.4 7.2

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Lending rates, Deposit rates, and Spread (Percent)

Effective Deposit Rate Effective Lending Rate (incl Bills) Spread

Fig 10: Adjusted Loans to Deposits Ratio at Private Banks

Source: Banks Survey data and NBE*Adjusted for reserve requirements and banks' holdings of NBE Bills & T-Bills.

87.5

97.2

94.0

95.5

93.0

98.499.0

86.0

88.0

90.0

92.0

94.0

96.0

98.0

100.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Adjusted L/D Ratio* (Percent)

Fig 12: Costs to Income Ratio at Private Banks

Source: Banks Annual Reports, and NBE

41.041.7 41.7

44.9

40.9

38.6

36.0

37.0

38.0

39.0

40.0

41.0

42.0

43.0

44.0

45.0

46.0

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Costs (excluding interest) to Income Ratio, %



5

Recent Performance: Underlying sources of strong performance (continued) § Seen from a longer-term perspective, and applying a Dupont analysis to bank’s underlying earnings, the strongest

contributors to the high returns of Ethiopian banks continue to be their sizeable net interest margins, low overhead costs, and low loan-loss provisions.

§ For about a quarter of all banks, high non-interest income (reflecting strong fx trading businesses and high fx fees) also contributed materially to the high EPS results.

§ Many of the above factors are, in turn, reflective of long-standing structural features of the banking sector: excess demand for both credit and foreign exchange gives banks relatively strong pricing power in both areas, the simplified nature of most bank service offerings allows for low overhead costs (relative to revenue or assets), and a reliance on collateral-based lending practices makes possible a relatively low cost of risk.

Fig 13: Dupont Analysis for Private Banking Sector

Dupont Decomposition 2013 2014 2015 2016 2017 2018 2019Interest income to Assets 5.8% 6.2% 6.7% 7.3% 7.1% 8.4% 8.0%Interest cost to Assets -2.3% -2.3% -2.5% -4.9% -2.9% -3.5% 3.3%Net interest income to Assets 3.5% 3.9% 4.1% 3.2% 4.3% 4.9% 4.7%Other income to Assets 4.8% 4.9% 4.7% 4.4% 4.3% 3.7% 2.6%Total income to Assets 8.3% 8.8% 8.8% 7.5% 8.6% 8.6% 7.3%

Operational costs to Assets -3.5% -4.3% -4.5% -4.5% -4.9% -4.7% -4.2%Operational profit to Assets 4.2% 4.5% 4.3% 4.4% 3.7% 3.8% 3.1%Provisions to Assets -0.5% -0.3% -0.2% -0.4% -0.3% -0.2% -0.2%

Profits-Before-Tax to Assets 3.8% 4.2% 4.1% 4.0% 3.4% 3.6% 3.1%Taxes to Assets -1.1% -0.9% -1.0% -0.9% -0.8% -0.9% -0.7%Profits-After-Tax to Assets (ROAA) 3.2% 3.3% 3.1% 1.7% 2.6% 2.8% 2.9%Leverage ratio (Assets to total equity) 6.8 6.4 6.5 6.8 7.2 7.4 7.8Profits to Equity (ROAE) 21.6% 20.5% 19.7% 20.3% 17.8% 20.2% 20.4%

Total Equity to Paid-up Equity 1.7 1.5 1.6 1.5 1.6 1.5 1.7 Earnings Per Birr 1,000 Share 36.0% 31.1% 30.8% 29.5% 28.4% 31.2% 33.7%

Source: Banks' Annual Reports

Fig 14: Dupont analysis: Bank by bank analysis for FY 2018-19 data

Awash Dashen Abyssinia Wegagen NIB United CBO Lion Zemen OIB Bunna Berhan Abay Addis Enat DebubGross interest income to Assets 9.2% 8.5% 9.8% 8.8% 9.5% 9.9% 7.8% 9.6% 7.5% 8.6% 9.3% 9.2% 8.0% 8.4% 9.5% 7.4%Gross interest expense to Assets -3.2% -3.8% -4.2% -3.6% -4.0% -4.6% -2.9% -3.5% -3.9% -3.0% -3.2% -3.6% -3.4% -4.3% -6.2% -3.3%Net interest income to Assets 6.0% 4.7% 5.6% 5.2% 5.4% 5.3% 5.0% 6.1% 3.6% 5.6% 6.1% 5.6% 4.6% 4.1% 3.3% 4.1%Other income to Asssets 3.2% 2.5% 2.2% 2.4% 1.6% 2.1% 2.5% 3.1% 4.2% 3.0% 4.0% 4.0% 5.3% 5.4% 3.1% 8.5%Operating income to Assets 9.2% 7.2% 7.8% 7.6% 7.0% 7.3% 7.5% 9.3% 7.7% 8.6% 10.1% 9.6% 10.0% 9.5% 6.4% 12.6%

Operating expenses to Assets -4.0% -4.7% -4.6% -4.8% -3.7% -4.3% -3.9% -4.7% -3.1% -4.5% -5.2% -6.1% -4.6% -5.1% -3.3% -5.7%Operating profit to Assets 5.1% 2.5% 3.2% 2.9% 3.3% 3.1% 3.6% 4.6% 4.7% 4.2% 4.9% 3.5% 5.3% 4.4% 3.0% 6.9%Provisions to Assets -0.6% 0.0% -0.3% -0.3% -0.2% 0.3% -0.1% -0.6% 0.0% -0.6% -0.4% -0.5% -0.4% -0.2% -0.1% -0.4%

Profit before tax to assets 4.5% 2.5% 2.9% 2.6% 3.1% 3.3% 3.5% 4.0% 4.7% 3.6% 4.5% 3.0% 5.0% 4.2% 3.0% 6.5%Taxes to assets -1.4% -0.5% -0.7% -0.4% -0.7% -0.7% -0.3% -0.9% -1.1% -0.9% -1.2% -0.7% -1.3% -0.9% -0.4% -1.7%Profit after tax to assets (ROAA) 3.1% 2.0% 2.2% 2.2% 2.4% 2.6% 3.2% 3.1% 3.6% 2.7% 3.3% 2.3% 3.7% 3.3% 2.6% 4.8%Leverage ratio (assets/total equity) 8.1 8.0 7.8 7.0 7.8 9.4 7.4 7.9 6.7 8.8 6.0 6.7 6.4 4.8 5.8 5.2 Return on equity (ROAE) 25.1% 16.0% 16.9% 15.2% 18.4% 24.5% 23.4% 24.7% 23.7% 23.7% 20.2% 15.2% 23.5% 15.8% 14.8% 25.1%

Total capital to paid-up capital ratio 2.5 2.6 1.7 1.7 1.7 1.6 1.6 1.5 1.7 1.6 1.4 1.6 1.5 1.3 1.2 1.3 Earnings per share, actual 63.2% 40.8% 28.9% 25.6% 30.8% 39.2% 36.4% 38.0% 39.8% 37.4% 28.7% 24.7% 34.3% 20.7% 18.5% 32.3%

Source: Cepheus research based on banks' Annual Reports. Shaded cells show bank with best performance for given line-item



6

Banking Sector: Banking Sector Market shares § Private banks continue to make strong gains in capturing market share, and now make up 43 percent of sector

deposits and 55 percent of sector profits. § Looking just at new deposits, the amount of deposits mobilized by private banks last year (Birr 89bn) substantially

exceeded that mobilized by CBE (54bn); this partly reflects the fast-expanding branch network of private banks, who opened 641 branches during the year, or four times the 160 new branches added by CBE.

§ In a historic first, private banks’ collective profits now exceed that of the state bank, reaching Birr 17bn ($538mn) in FY 2019-20 or 55 percent of Ethiopia’s Birr 31bn ($980mn) banking profit pool.

Fig 15: Deposit Levels in 2019-20 at Banks (Birr bns)


595

54

447

89

-

100

200

300

400

500

600

700

Deposit Levels Deposit Increase Last Year

CBE Private Banks

Fig 17: FY 2019-20 Profit Levels at Private Banks


14.017.0

31.0

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

CBE Private Banks Total

FY 2019-20 Profit Before Tax (Birr bns)

Fig 16: Deposit Market Share Trends at Banks


68% 68% 66%64%

62%60%

57%

32% 32% 34%36%

38% 40%43%

30%

35%

40%

45%

50%

55%

60%

65%

70%

2014 2015 2016 2017 2018 2019 2020

Deposit Market Share (Percent)

CBE Private Banks

Fig 18: Profit Market Share at Private Banks


67.4%70.2% 70.3%

57.5%

50.9% 52.9%

45.2%

32.6%29.8% 29.7%

42.5%

49.1% 47.1%

54.8%

25.0%30.0%35.0%40.0%45.0%50.0%55.0%60.0%65.0%70.0%75.0%

2014 2015 2016 2017 2018 2019 2020

PBT Market Shares (Percent)

%CBE %Privates



7

Banking Sector: Banking Sector Market shares (continued) § Seen over a longer time frame, CBE has seen a steady decline in its market share in deposits and loans (both down

by about 10 percentage points) as well as in profits (down 25 percentage points) over the past five years. § Despite the above trends, CBE is still the single largest bank in the sector, with deposits and profits that are 8.5x

and 3.8x respectively that of the largest private bank. § Moreover, in certain areas, CBE remains the market leader even when compared to all private banks as a group:

for example, on foreign exchange intermediation, fx inflows captured by CBE (via remittances and exports) likely exceed the $4.5bn intermediated by all private banks in FY 2018-19, while the bank’s CBE Birr mobile wallet platform (with 2.1mn users) is substantially larger than the offerings of all other banks in the market.

Fig 19: CBE Market Share (%)

Source: CBE Survey and Annual Reports

71.9%70.5% 70.9%

68.7%

65.7%

61.2% 60.8%

54.0%56.0%

58.0%

60.0%

62.0%

64.0%

66.0%

68.0%

70.0%

72.0%74.0%

2014 2015 2016 2017 2018 2019 2020

Loans

67.6% 67.3%

61.2%

64.4%

61.9%60.1%

57.1%

50.0%52.0%

54.0%

56.0%58.0%

60.0%62.0%

64.0%

66.0%68.0%

70.0%

2014 2015 2016 2017 2018 2019 2020

Deposits

67.2% 70.0% 70.3%65.1%

49.6%52.9%

45.2%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

2014 2015 2016 2017 2018 2019 2020

Profit



8

Banking Sector Outlook:—Macro Policy Reforms § Macro policy reforms will bring major changes—as summarized below—to the banking sector as Government

modernizes its framework for deficit financing, monetary policy setting, and exchange rate determination.

Fig 20: Macroeconomic Reforms Affecting Banking Sector Operations

Area Issue RemarksThe launch of Treasury Bill auctions in Dec 2019 has provided a new framework for private banks to lend to Govt via 28-day and 90-day Bills that help cover the annual budget deficit. Gross T-Bills of 18bn were issued to banks in FY 2019-20, and interest rates have risen to a range of 7-9 percent, sufficient to at least cover banks' cost of funds.

Looking ahead, private banks will now likely become more material financing providers to the Government based on (and assuming) increasingly market-determined interest rates at the Treasury Bill auctions. Previously, mandatory funding requirements imposed on banks required them to purchase NBE Bills equal to 27% of their new loans and a fixed (5%) interest rate. T-Bill allocations were roughly 2 percent of private banks' assets as of June 2020 (Birr 12bn net T-bills vs Birr 565bn in assets), though NBE Bills were near 20 percent of bank assets in June 2019, suggesting much more additional room for banks to assume additional T-Bill purchases in the coming years.The T-Bill Market is expected to remain closed to foreign investors, thus preventing foreign portfolio inflows in this area, consistent with Ethiopia's still-closed capital account and fx constraints. Returns on holdings of T-bills expected to be more reflective of market rates (or at least enough to cover funding costs)Ability to sell T-Bill holdings, rather than holding them to maturity, will provide substantial liquidiy buffers to banks as they can liquidate their T-Bill holdings for cash in times of acute liquidity stressHigher interest rate in T-Bill market could potentially impose tighter discipline on size of Govt domestic borrowingMinimum purchase mandates not yet in place, but may be imposed if deficit financing needs become substantialDue to moral suasion or via other pressures, as is sometimes common by many central banks, interest rates may not rise to fully market levels, implying lower earnings from holding T-Bills versus allocating funds to private sector borrowersCrowding out: Credit to the private sector will be reduced by amount of T-Bill financingT-Bill market already started in December 2019, but a secondary market in T-Bills is still not established and is expected to start in late 2020, allowing banks to exchange Bills for cash at times of liquidity stressAdditional instruments such as Treasury Bonds (with a more than 1-year maturity) may start in 2021 and beyond as declining inflation allows for longer-term maturities to be issued.More conventional monetary policy tools and instruments expected in the near future--including most likely a reference central bank policy rate that sets the floor (and provides signalling) for interest rates and the practice of buying/selling Treasury Bills and Bonds by the NBE to inject/withdraw liquidity from the banking systemNBE can also use other potential tools--including its own Bills for liquidity management purposes and RR changes Banks will need more active liquidity management operations/desks to anticipate impacts of changing interest rates, inflation rates, and monetary policy decisions; improved forecasting capabilities in this area will be important as well.Banks will have more tools at their disposal to manage unexpected liquidity conditionsBanks will have a common benchmark at which to set minimum rates for their lowest risk or prime customers

Central bank's interest rate floor, if set to maintain positive real rates, may imply high lending rates than those currently offered for prime customers and could consequently limit loan demand (if inflation stays at elevated levels)The full flexibility to set lending rates that banks currently have may be constrained somewhat if/when the NBE policy rate becomes the de facto minimum lending ratePotentially in the next fiscal year, i.e., FY 2021-22Implementation is unlikely to start until inflation is firmly under control and is at or near single-digit levelsA market-determined exchange rate would imply banks having the flexibility to adjust their buying/selling rates to clients depending on supply/demand conditions that they see in the market. At present, all banks receive daily buying/selling rates from the central bank each morning and all banks follow that rate for the day's fx transactionsThe scope for exchange rate changes may still be kept within prudential limits, including for example maximum daily upward/downward percent movements that are common in some emerging marketsThe central bank may also, of course, occasionally intervene if it feels the exchange rate is depreciating/appreciating at an unduly rapid rate by selling/buying dollars to the market; banks would need to be the counterparties to such fx interventions by the central bankBanks could secure more fx by adjusting their rates to more depreciated offers if there are willing buyers at that (more depreciated) rateExchange rates will not necessarily be identical at all banks (as is the case at present) and customers will have greater opportunities to shop around for better rates (as they now do for lending rates); banks will also have room to differentiate (within certain regulatory limits) among their customersForeign exchange portfolio management will be more challenging as fx valuation changes (which thus far always translated into Birr gains when holding USD assets) can now bring both Birr gains (if/when Birr depreciates) as well as Birr losses (if/when Birr appreciates). Internal finance and treasury management staffing and functions will require considerable training and upgradingHigh fees charged for Letters of Credit should fall significantly and be subject to competition, as the greater fx availability implied by flexible exchange rates would limit banks' pricing power on charges for L/Cs and P/Os.Unlikely this year, possible in FY 2021-22, and more certain for FY 2022-23

Source: Cepheus Research compilation

MONETARY POLICY

Implications for Bank Operations

Positive opportunities for BanksPotential threats to Banks

Expected timing

GOVERNMENT DEFICIT FINANCING

Implications for Banking Operations

Positive opportunities for banks & wider economyPotential threats to banks & wider economyExpected timing

EXCHANGE RATE DETERMINATION

Implications for Bank Operations

Positive opportunities for Banks

Potential threats to Banks

Expected timing



9

Banking Sector Outlook:—Changing Financial Sector Landscape § Besides wide-ranging macro reforms, broader financial sector liberalization will also alter the banking landscape

by bringing many new entrants, additional service offerings, and a wider range of funding sources.

Fig 21: Ethiopia's Changing Financial Sector Landscape

Area Issue Remarks

Close to 20 new banks are currently under formation, potentially bringing Birr 20-40bn in paid-up capital, and likely raising the number of banks in Ethiopia towards levels seen in Kenya (44 banks) and Egypt (40 banks).Prospective entrants include: Zemzem Bank, Hijra Bank, ZAD Bank, Goh Betoch Bank, Amhara Bank, Gadaa Bank, Sheger Bank, Selam Bank, Jano Bank, Ahadu Bank, Afro Bank, Dallol Bank, Kush Bank, Ethiopian Diaspora Bank

Foreign banks are still unlikely to be permitted to enter in the next couple years but could be possible thereafter. Prospective players that might enter--via acquisitions or greenfield operations--include banks in Kenya (Equity, KCB, CBO), South Africa (Standard Bank), Egypt, Morocco, plus regional players such as EcobankNon-bank funding from a prospective stock market will represent an alternative option for Ethiopia's largest firmsA few dozen firms (with revenue of above say Birr 500mn) could choose stock market funding rather than bank loansHowever, stock market launch and activity is unlikely to be in fully in place till 2022 or beyondAround five quasi-public and one private/foreign leasing company (Ethio-Leasing) are currently in placeLow entry requirements (Birr 400mn capital) and openness to foreign investors should attract additional entrantsMore than 35 MFIs currently in place and the largest of these are expected to potentially convert to banksConversion would allow new banks to engage in fx services and take advantage of higher lending limitsLarge SACCOs may also convert into banks, potentially in specialized areas such as agricultureLoosening of regulations is allowing for start-ups in mobile wallet, e-payments, and e-commerce spaceFin-techs could compete with banks' existing mobile money offerings and/or partner in particular sets of servicesScaling up has posed a challenge in this sector, however, and ability to do so has yet to be proven New banks could focus on particular market niches: interest-free banking, regional markets, sector focus (mortgages, agriculture), or types of services (cash-flow based lending, start-up financing, equity investment)Revamped and strengthened DBE is expected to also pose additional competition to commercial banksProviders of specialized services may also join sector, i.e. ATM/POS operators, cash pick-up/delivery providersDevelopment Finance Institutions: IFC, CDC, AfDB, US DFC, and others expected to boosting debt/equity offeringsEXIM Banks with private sector lending windows (in China, India, Turkey, UK, EU, etc) likely to remain in marketFDI companies already in Ethiopia also deploying surplus funds to re-invest in sectors beyond their core businessPrivate Equity and Venture Capital firms will also increasingly provide long-term equity funding alternativesThe start of stock markets and bond markets expected to bring associated business opportunities for banksBanks, advisory firms, and brokerage service providers will be a core part of this new ecosystemAdvisory services in bond/stock issuance and in mergers/acquisitions expected to be potential bank offeringsNon-branch based banking channels likely to become part of market for payments, saving, borrowing, and investing Few large mobile-based service providers (banks, non-banks or joint ventures) likely to become dominant payment platforms once widespread public acceptance/usage takes offConsumer lending already beginning to become a standard service offering at most banksNational ID, being pushed by most banks, could substantially increase consumer lending activity in the coming yearsCredit card services could also enter the market, supported by National ID, credit registries, and rising middle classNon-collateral based financing: Using projected cash-flows; credit-scoring based methods, etc is a growing prospectPotential growth in micro-lending using digital channels is also a strong prospect, per many regional examplarsSME lending could also become a material share of the market through existing bank channels or specialized outfitsLarge corporates likely to be able to issue bonds directly to the public (for lower rates) rather than using bank loansBanks may also consider bond issues (regulations permitting) as an additional funding source beyond just deposits. Fx-generating local companies will increasingly have the option of seeking foreign loans for long-term financingPer recently issued Directives, banks will also be able to contract foreign loans to on-lend to their corporate clients

Source: Cepheus Research compilation based on NBE announcements, Directives, press reports, and industry sources

External

borrowing

NEW FUNDING

SOURCES

Local bond

issuance

NEW ENTRANTS &

COMPETITORS

New Banks

Stock market

Leasing

Companies

MFIs and

SACCOs

Fin-techs

Specialized

service

providers

Foreign

financiers

NEW SERVICE

OFFERINGS

Capital

market

services

Digital

banking

Consumer

lending

Other

unconvention-

al services



10

Banking Sector Outlook:—Competitive Environment § In terms of competitiveness, most indicators show there has been active competition among banks for most of the

past decade, though there are some signs pointing to a pause during the last three years. § The market shares held by the largest banks have fallen from a range of 75-85 percent ten years ago to around 50-

55 percent in recent years, suggesting improving competitiveness, particularly for newer/younger entrants. § Further indications of a competitive environment are seen from the fact that several newer banks have managed

to match or exceed the deposits of older banks, have crossed certain critical thresholds (such as profits of Birr 1bn), and have reached the ranks of the highest yielding banks (in terms of shareholder returns) alongside many of the older, established private banks.

Fig 22A: Concentration indicators over the past decade at private banks: Market Share of Top 5 Banks


80.1

62.6

56.856.5

57.356.8 55.8

54.0

82.5

64.2

60.1 57.4

55.753.4 52.6

52.7

74.1

58.5

55.9 55.1

53.1 53.2 51.6 50.248.0

53.0

58.0

63.0

68.0

73.0

78.0

83.0

2009 2014 2015 2016 2017 2018 2019 2020

Concentration Indicators

Loans Deposits Capital

Fig 22B: Profit Concentration over the past decade at private banks: Market Share of Top 5 Banks


82.9

46.7

42.3 44.242.3 41.5

40.0

51.4

35.0

40.0

45.0

50.0

55.0

60.0

65.0

70.0

75.0

80.0

85.0

2009 2014 2015 2016 2017 2018 2019 2020

Profit share

Fig 22C: EPS concentration at Private banks [top 5 banks vs all other banks]

Source: Banks Annual Reports

38.5

31.0 30.8

29.5

28.4

31.2

32.7

38.7

27.4

28.3

31.3

27.928.6

33.3

26.0

28.0

30.0

32.0

34.0

36.0

38.0

2009-10 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Average EPS (Top 5 vs all others)

Average EPS (Top 5 banks) Average EPS (all othes banks)



11

Banking Sector Outlook:— Shareholder Returns

§ In terms of shareholder earnings, while banks continue to offer attractive returns, average EPS levels have fallen from the high 30s to the low 30s over the past decade.

§ In addition, given recent levels of inflation, real returns declined sharply last year and are now around 12 percent, or roughly half the real returns seen by shareholders five years ago.

Fig 23A: EPS Trends at Private Banks, in percent


38.5 36.5 36.6 36.0

31.0 30.8 29.5 28.4 31.2

33.7 31.5

-

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Earnings per share, in percent

Fig 23B: EPS Trends in Real Terms at Private Banks

Source: Banks Survey data and NBE*EPS returns less year-average inflation for the relevant fiscal year.

18.4

2.5

22.5 22.9 23.1

19.8 21.2

18.1

21.1

11.6

-

5.0

10.0

15.0

20.0

25.0

2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

EPS in Real Terms*



12

Banking Sector Outlook:—Performance across banks

§ Looking at the distribution of performance across banks, some financial metrics point a widening gap between the

highest and lowest performers over the past three years. § For profits, market shares among private banks had steadily narrowed over the years and reached a low range

(max minus min) of 16.3 percentage points in 2015-16; this has since rise to 22 percentage points, showing greater dispersion in market share within the private banking sector.

§ For EPS, there is an even larger dispersion among private banks, with the range in performance widening from a low of 26 percentage points in FY 2016-17 to 48 percentage points in FY 2018-19.

Fig 24A: Profit share changes at private banks


20.3 17.7 17.0 17.8 18.7

23.9

19.9 17.3 16.3 16.9 17.4

22.4

0.4 0.4 0.6 0.9 1.4 1.5

-

5.0

10.0

15.0

20.0

25.0

30.0

2014 2015 2016 2017 2018 2019

Profit share changes across banks

Max Profit share Range in profit share Min profit share

Fig 24B: EPS changes at private banks


67.0

58.9

48.7

40.9

54.3

63.2 57.90

52.30

44.30

26.00

41.20 44.70

9.1 6.6 4.4

14.9 13.1 18.5

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

2014 2015 2016 2017 2018 2019

EPS changes across banks

Max EPS Range in EPS Min EPS



13

Banking Sector Outlook:—Forecasts for FY 2021 and FY 2022

§ Looking ahead, we update our banking sector model from last year and forecast trends in the sector’s key growth drivers (deposits and fx) as well as its aggregate balance sheet, income levels, and rates of return.1

§ We expect Ethiopia’s banks to show somewhat slower growth this fiscal year, as anti-inflationary measures take precedence in the near-term and the recent policy stimulus is gradually withdrawn by mid-2021. Thereafter, and given Ethiopia’s still low starting base, we anticipate a return to stronger banking growth as (we presume) political economy conditions gradually normalize, COVID impacts fade away, and several longer-term growth drivers (the New Ten-Year Plan, Doing Business reforms, financial sector liberalization) begin to firmly take root.

§ With respect to average shareholder returns, we project—as before—that these will fall somewhat from past highs but still remain comfortably above 25 percent per annum in Birr terms.

1 Our projections from more than a year ago (May 2019) were generally within 5 to 15 percent of the actual June 2020 outturns. For June 2020, we had projected deposits of Birr 1,099bn vs a Birr 1,043 outturn (a 5 percent difference), loans of Birr 543bn vs a Birr 590bn outturn (an 8 percent difference), and total industry profits of Birr 36bn vs a Birr 31bn outturn (a 14 percent difference). For private banks alone, we had projected profits of Birr 13.2 bn, though this turned out even higher at Birr 16.9bn, and our EPS projection was correspongly lower at 27.7 percent vs an 31.5 percent estimated outturn.

Fig 25: Banking Sector Model--Key Balance Sheet, Income Statement, and Operating metrics

Estimate

2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22Private Banks Key Financials: Birr bns

Deposits 146.5 201.8 278.5 358.0 447.0 527.5 633.0

Loans 91.4 132.6 178.8 259.0 347.0 416.4 508.0

NBE Bills 41.7 53.6 71.3 89.0 67.0 50.0 37.0

T-Bills … … … … 12.0 37.0 62.0

Total Assets 190.5 259.7 348.6 447.0 565.2 666.9 800.3

Total Capital 33.1 26.0 44.0 57.4 75.3 85.8 107.2

Paid-up Capital 16.1 20.9 26.2 32.9 42.1 52.6 65.8

Interest income 12.2 16.4 25.9 35.6 47.5 56.9 67.2

Interest expense 5.9 6.4 10.3 14.6 22.1 25.8 29.0

Other income 6.4 8.4 9.3 11.6 14.3 16.8 19.8

Operating expenses 8.2 11.0 14.4 18.6 22.7 28.2 33.9

Profit Before Tax 5.8 7.6 10.4 14.0 17.0 19.7 24.0

Profit After Tax 4.5 5.7 8.1 10.7 13.1 15.1 18.5

Earnings per share 29.5% 28.4% 31.4% 33.7% 31.5% 29.9% 29.2%

Key Operating MetricsEffective deposit rate 5.5% 3.9% 4.5% 4.8% 5.5% 5.3% 5.0%

Effective lending rate 10.4% 10.4% 11.9% 12.0% 14.2% 13.5% 13.0%

Net interest margin 4.6% 6.2% 6.9% 7.0% 6.6% 6.7% 6.9%

Other income growth 13.2% 30.6% 10.9% 24.7% 23.0% 17.0% 18.0%

Cost-to-income ratio 41.7% 44.9% 40.9% 38.6% 36.7% 38.2% 39.0%

Provision-to-Assets 0.80% 0.47% 0.34% 0.41% 0.60% 0.75% 0.75%

Leverage 5.7x 10.0x 7.9x 7.8x 7.5x 7.8x 7.5x

Commercial Bank of Ethiopia Deposits 288.6 364.9 451.8 541.0 595.0 682.8 819.3

Loans 138.8 154.2 173.3 197.0 243.0 298.9 367.6

Bonds 188.7 237.8 319.1 395.2 400.0 492.0 605.2

Total Capital 16.1 40.0 47.2 49.8 56.8 65.4 75.2

Total Assets 384.6 485.7 573.9 712.9 813.8 933.8 1,120.6

Profit before tax 13.7 14.6 10.4 15.7 14.0 17.0 21.5

All Commerical BanksDeposits 435.1 566.7 730.3 899.0 1,042.0 1,210.2 1,452.3

Total Capital 49.2 66.0 91.2 107.2 132.2 151.1 182.4

Profit before tax, Birr bns 19.5 22.2 20.8 29.7 31.0 36.7 45.5

Profit before tax, USD bns 0.92$ 0.99$ 0.82$ 1.06$ 0.98$ 0.97$ 1.05$

Growth rates--all banks: Deposits … 30.2% 28.9% 23.1% 15.9% 16.1% 20.0% Credit … 25.5% 28.4% 26.6% 12.4% 18.9% 20.7% Profits … 14.0% -6.6% 43.0% 4.4% 18.3% 24.1%

Source: Banks' Annual Reports, Bank Surveys, CBE website for CBE Annual Reports, NBE Annual Reports for Bond estimates,and Cepheus Research for certain estimates and projections

Actuals Projections



14

Ethiopia’s Private Banking Sector: Data Appendix

Sector-wide trends: data up to June 2020

1. Bank deposits by bank…………………………………………………………………………..………....…pg 15 2. Bank loans by bank……………………………………………………………………………………………....pg16 3. Capital levels by bank………………………………………………………………………………..….…...…pg17 4. Branch levels by bank…………………………………………………………………………………….….....pg18

Sector-wide trends: data up to June 2019

5. Balance Sheet ratios by bank……………………………………………………………………...………..pg 19 6. Income Statement ratios by bank …………………………………………………………………………pg 20 7. Productivity ratios by bank …………………………………………………………………………………..pg 21 8. Earnings per share by bank………………………………………………………..…………………….……pg 22

9. Bank-by-bank performance metrics for 2018-19.………………………………..…………..pgs 23,24 10. Aggregate private banking sector metrics for 2014-15 to 2018-19………………………...pg 25

Bank-by-bank performance: five-year overview up to June 2019

11. Awash Bank ……………………………………………………………………………………………..…………….pg 26 12. Dashen Bank …………………………………………………………………………………………..………………pg 27 13. Bank of Abyssinia …………………………………………………………………………………..…………..…..pg 28 14. Wegagen Bank ……………………………………………………………………………………..…………………pg 29 15. NIB Bank ……………………………………………………………………………………………..………………….pg 30 16. United Bank ……………………………………………………………………………………………..…………..…pg 31 17. Cooperative Bank of Oromia ……………………………………………………………………………………pg 32 18. Lion Intl Bank ……………………………………………………………………………………………………..……pg 33 19. Zemen Bank …………………………………………………………………………………………………….………pg 34 20. Oromia Intl Bank ………………………………………………………………………………………..……………pg 35 21. Bunna Bank …………………………………………………………………………………………………..…………pg 36 22. Berhah Bank ……………………………………………………………………………………………….……………pg 37 23. Abay Bank ………………………………………………………………………………………………………..………pg 38 24. Addis Intl Bank …………………………………………………………………………………………………………pg 39 25. Enat Bank …………………………………………………………………………………………………………………pg 40 26. Debub Global Bank ………………………………………………………………………………………..…………pg 41



15

Appendix Table 1: Bank Deposits as of June 2020 (Provisional data)

Source: Banks survey data (provisional data that may differ somewhat from final audited figures)

4.6

5.2

8.2

13.9

14.4

16.0

16.5

26.1

27.6

30.1

33.3

34.7

45.5

47.5

53.4

70.2

- 10.0 20.0 30.0 40.0 50.0 60.0 70.0

Addis

Debub

Enat

Bunna

Zemen

Abay

Berhan

Lion

OIB

Wegagen

NIB

United

CBO

Abyssinia

Dashen

Awash

Deposits (Birr bns), June 2020

11.014.2

18.418.5

21.922.523.623.624.024.725.325.8

27.728.629.2

40.9

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0

EnatLionAbay

BunnaAbyssinia

AddisDashen

NIBBerhanUnitedDebub

OIBWegagen

AwashCBO

Zemen

% Checking Deposits, June 2020

4.1%10.9%

14.7%17.2%17.8%18.2%19.7%

24.1%26.1%26.6%

28.7%31.3%

38.8%48.5%49.6%

59.4%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

OIBBerhan

NIBEnat

AddisAwashDashenZemen

CBOUnited

WegagenBunnaAbay

AbyssiniaDebubLion

Deposits growth (Percent), June 2020

46.647.1

51.652.153.6

58.860.561.762.663.9

67.268.3

73.375.376.1

80.1

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0

EnatAddisZemenUnitedDebub

NIBOIB

WegagenCBO

AwashDashenBerhan

AbyssiniaAbay

BunnaLion

% Saving Deposits, June 2020



16

Appendix Table 2: Bank Loans as of June 2020 (Provisional data)


3.5 4.5

6.5 9.9

11.2 11.6

12.7 19.1

20.1 23.8

25.9 26.7

34.2 37.6

42.3 56.9

- 10.0 20.0 30.0 40.0 50.0

AddisDebub

EnatZemen

AbayBunna

BerhanLionOIB

WegagenNIB

UnitedCBO

AbyssiniaDashenAwash

Loans and Advances (Birr bns), June 2020

65.565.567.067.168.268.468.569.670.972.472.974.3

77.078.681.081.0

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0

DashenAbyssiniaWegagen

NIBUnited

CBOLion

ZemenOIB

BunnaBerhan

AbayAddisEnat

AwashDebub

Loans to Deposits Ratio (Percent), June 2020

54.054.556.0

58.158.859.159.560.460.461.761.862.362.562.764.766.7

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0

ZemenAddisAbayEnat

DebubOIB

AwashBerhan

LionNIB

UnitedDashenBunna

WegagenCBO

Abyssinia

Loans to Assets Ratio (Percent), June 2020

15.9%20.7%21.9%

24.9%27.0%27.1%27.5%29.9%30.4%

37.4%40.3%

44.2%49.9%

58.1%61.2%

84.3%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

OIB

AwashNIB

BerhanBunnaEnat

ZemenDashenAddisUnited

CBOWegagen

AbayAbyssinia

LionDebub

Loans and Advances growth (percent), June 2020



17

Appendix Table 3: Bank Capital levels as of June 2020 (Provisional data)


1.4

1.5 1.8

3.1

3.2 3.4

3.5 3.7

4.3

4.6 5.4

5.6 5.7

5.8

8.6 13.6

- 2.0 4.0 6.0 8.0 10.0 12.0 14.0

Addis

DebubEnat

AbayBunna

Zemen

BerhanLion

WegagenOIB

CBO

UnitedAbyssinia

NIBDashen

Awash

Total Capital (Birr bns), June 2020

1.01.0

1.41.8

2.22.22.2

2.52.93.03.03.13.2

3.43.5

5.8

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0

AddisDebubEnat

ZemenBunnaAbayLion

BerhanWegagen

CBOOIB

AbyssiniaUnited

NIBDashenAwash

Paid-Up Capital, June 2020

16.1%18.6%

23.7%24.8%25.3%25.7%

27.7%28.4%

32.2%40.8%

44.5%45.7%46.2%

50.0%64.4%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

WegagenAbyssinia

EnatBunna

OIBDashenBerhan

AbayAddis

NIBAwashLion

UnitedZemenDebubCBO

Total Capital Growth, June 2020

11.712.212.612.612.913.1

14.214.214.414.6

15.916.316.7

17.718.1

20.2

0.0 5.0 10.0 15.0 20.0

DashenAbyssiniaWegagen

NIBUnited

CBOAwashLion

ZemenOIB

BunnaBerhan

AbayAddisEnat

Debub

Capital to Assets Ratio (Percent), June 2020



18

Appendix Table 4: Bank branches as of June 2020 (Provisional data)


52 57

75 82

223 231

243 258

300 302

344 382

420 423

466 503

- 100 200 300 400 500

ZemenEnat

AddisDebub

AbayBerhanBunna

LionOIBNIB

UnitedWegagen

CBODashenAwash

Abyssinia

No. of Branches, June 2020

0.0%8.0%

10.3%12.7%12.7%13.2%13.7%

15.5%15.7%16.1%

18.5%20.9%

25.5%26.7%

49.3%51.9%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

DashenCBO

AddisLion

WegagenOIB

AwashBerhan

NIBAbay

BunnaZemenUnitedEnat

AbyssiniaDebub

2019-20 Branch Level %Change

-7 9

12 28 29 31 31 31

35 38

41 43

56 70

166

- 20 40 60 80 100 120 140 160 180

DashenAddis

ZemenEnat

DebubLionCBO

BerhanAbay

OIBBunna

NIBWegagen

AwashUnited

Abyssinia

2019-20 Branch Level Change

57 61 64

72 72

79 92 94

101 101

108 110

126 144

151 277

50 100 150 200 250

BunnaAddisDebub

BerhanAbay

WegagenOIB

AbyssiniaUnited

LionCBONIB

DashenEnat

AwashZemen

Deposit per Branch, Birr mns, June 2020



19

Appendix Table 5: Balance Sheet ratios as of June 2019

Source: Banks’ Annual Reports for FY 2018-19

58% 59%

65% 66% 67% 67% 68% 68% 68% 70% 71% 72% 73% 74%77% 79%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

OIB CBO Zemen Abay Berhan Addis Debub Wegagen Enat NIB Lion Dashen Abyssinia United Bunna Awash

Loans/Deposits Ratio, June 2019

Loans/Deposits Ratio, June 2019

7.910.8

11.712.212.612.612.913.1

14.414.6

15.916.316.7

17.718.1

20.2

0.0 5.0 10.0 15.0 20.0 25.0

CBOUnited

OIBDashen

LionAbyssinia

AwashNIB

WegagenBerhanZemenAbayEnat

BunnaDebubAddis

Capital to Assets Ratio (Percent), June 2019

85% 87%

96% 97% 98% 98% 98% 99% 100% 100% 101% 101% 102% 103% 103%

112%

0%

20%

40%

60%

80%

100%

120%

OIB CBO Zemen Abay Berhan Addis Debub Wegagen Enat NIB Lion Dashen Abyssinia United Bunna Awash

Adjusted L/D Ratio, June 2019

Adjusted L/D Ratio, June 2019

15.317.4

19.520.221.421.822.523.223.7

26.127.2

31.832.232.4

34.135.9

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0

EnatLionNIB

AbyssiniaUnitedAbay

DashenBunnaAddis

WegagenOIB

AwashDebubCBO

ZemenBerhan

% Checking Deposits, June 2019



20

Appendix Table 6: Income Statement ratios as of June 2019


32.243.0

46.046.4

52.058.160.5

65.065.065.366.166.468.4

71.771.8

77.4

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0

DebubAddisZemenAbayEnat

BerhanBunnaDashenAwash

OIBLionCBO

WegagenUnited

AbyssiniaNIB

Net Interest Income to Income Ratio (Percent), June 2019

26.327.3

33.535.937.337.438.438.5

41.041.141.942.543.1

45.249.8

52.2

0.0 10.0 20.0 30.0 40.0 50.0 60.0

ZemenEnat

UnitedNIB

AbayAwashDebubAddis

AbyssiniaLion

BunnaDashen

OIBWegagenBerhan

CBO

Costs (excluding interest) to Income, June 2019

22.628.228.3

31.633.633.934.735.035.0

39.541.9

48.053.654.0

57.067.8

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0

NIBAbyssinia

UnitedWegagen

CBOLionOIB

AwashDashenBunnaBerhan

EnatAbay

ZemenAddisDebub

Non -nterest Income to Income Ratio (Percent), June 2019

-3.1-0.4

0.00.91.2

2.22.8

3.23.5

4.04.14.2

4.66.56.9

8.0

-4.0 -2.0 0.0 2.0 4.0 6.0 8.0 10.0

UnitedDashenZemenEnatCBO

AddisNIB

AbyssiniaWegagen

DebubBunnaAbay

BerhanLionOIB

Awash

Provision Expenses to Total Expenses, June 2019



21

Appendix Table 7: Productivity ratios as of June 2019


0.50.60.6

0.70.70.7

0.80.90.90.90.91.0

1.11.2

1.81.8

0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0

LionAbay

BerhanNIB

WegagenAbyssinia

CBOOIB

AwashUnitedDashenDebubBunnaAddisZemenEnat

Revenue per employee, June 2019

8.99.59.59.69.79.911.012.212.712.812.913.213.9

19.621.8

36.8

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0

BunnaWegagen

CBOAbayLion

AddisBerhan

OIBAbyssinia

NIBDebubDashenUnitedAwashEnat

Zemen

Revenue per branch, June 2019

0.10.10.10.10.10.20.20.2

0.20.2

0.30.30.30.3

0.40.5

0.0 0.1 0.2 0.3 0.4 0.5 0.6

LionBerhan

AbyssiniaWegagen

NIBCBOAbay

DashenUnited

OIBAwashBunnaAddisDebubEnat

Zemen

Profit per employee, June 2019

1.71.8

2.32.32.32.32.42.42.62.72.82.8

3.94.5

5.911.3

0.0 2.0 4.0 6.0 8.0 10.0 12.0

CBOWegagenBunnaBerhan

AbyssiniaAddisLion

DashenAbay

UnitedNIBOIB

DebubEnat

AwashZemen

Profit per branch, June 2019



22

Appendix Table 8: Earnings per share ratios as of June 2019

Source: Banks’ Annual Reports. Note: Bank-by-bank EPS data for the just ended fiscal year (2019-20) are available on a provisional basis but are not presented here. The 2019-20 sector-average EPS of 31.5 percent reported on pages 1 and 3 is calculated from banks’ provisional after-tax profit figures applied to their estimated year-average paid-up capital.

Private Banks: Earnings per share over the past decade, in percent

Ranked by ten-year average EPSTen-year

2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 AverageDashen Bank 60.9 75.3 92.6 82.3 67.0 58.9 48.7 39.2 43.0 40.8 60.9Awash Bank 49.3 56.0 46.9 45.6 47.5 44.5 37.1 40.9 54.3 63.2 48.5Zemen Bank 38.7 58.1 57.7 41.0 32.1 32.0 35.0 38.4 28.6 39.8 40.1United Bank 47.7 52.8 52.8 47.7 34.1 29.8 32.4 27.2 35.4 39.2 39.9Abyssinia Bank 44.7 56.7 54.4 50.2 38.1 27.8 31.5 37.6 24.4 28.9 39.4Coop Bank of Oromia 17.0 29.0 45.0 52.0 61.0 50.0 4.4 22.0 42.0 36.4 35.9Lion Bank … 17.6 24.4 31.5 23.6 42.5 47.9 31.2 30.2 38.0 31.9Wegagen Bank 38.0 44.8 37.8 33.0 26.1 24.4 22.2 28.0 36.5 25.6 31.6NIB Bank 37.6 38.0 34.4 29.4 28.6 27.4 25.8 31.4 26.8 30.8 31.0Oromia Intl Bank 12.3 20.5 14.8 19.2 31.0 36.4 31.0 27.8 52.5 37.4 28.3Berhan Bank … 17.5 20.6 20.5 23.9 20.7 39.9 32.8 20.4 24.7 24.5Bunna Bank … 10.7 13.3 21.1 22.8 28.7 34.0 24.2 28.6 28.7 23.6Abay Bank … -2.5 12.2 14.4 16.3 27.2 23.1 22.9 28.4 34.3 19.6Addis International Bank … … 5.7 15.9 19.6 18.7 19.3 18.7 17.1 20.7 17.0Debub Global Bank … … … … 9.1 6.6 22.8 17.4 13.1 32.3 16.9Enat Bank … … … … 14.9 16.4 16.8 14.9 18.4 18.5 16.7

Average 38.5 36.5 36.6 36.0 31.0 30.8 29.5 28.4 31.2 33.7 31.6Median 38.7 38.0 36.1 32.2 27.4 28.3 31.3 27.9 28.6 33.3 31.3

Older six 46.4 53.9 53.1 48.0 40.2 35.5 33.0 34.1 36.7 38.1 41.9Newer ten 22.7 21.5 24.2 27.0 25.4 27.9 27.4 25.0 27.9 31.1 25.4Maximum 60.9 75.3 92.6 82.3 67.0 58.9 48.7 40.9 54.3 63.2 60.9Minimum 12.3 -2.5 5.7 14.4 9.1 6.6 4.4 14.9 13.1 18.5 16.7

18.5

20.7

24.7

25.6

28.7

28.9

30.8

32.3

34.3

36.4

37.4

38.0

39.2

39.8

40.8

63.2

15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 55.0 60.0 65.0

Enat

Addis

Berhan

Wegagen

Bunna

Abyssinia

NIB

Debub

Abay

CBO

OIB

Lion

United

Zemen

Dashen

Awash

Earnings per share (Percent), June 2019



23

Private Banks Overview: FY 2018-19

Balance Sheet AIB DB BOA WB NIB UB CBO LIB ZB OIB Bunna Berhan Abay Addis Enat DGBAssets 74,635 56,218 39,294 29,770 33,717 35,736 41,791 20,392 14,689 31,779 14,495 19,173 15,106 5,515 9,202 5,488 Loans and Advances 46,855 32,366 23,421 16,096 19,251 21,612 21,405 11,622 7,610 15,324 8,149 10,033 7,597 2,649 5,094 2,401 NBE Bills 11,221 12,295 7,565 6,867 6,867 7,384 8,279 4,230 3,205 7,063 3,257 4,256 3,386 1,063 1,924 1,089 Foreign Assets 3,385 1,152 549 116 28 338 367 34 1,465 1,291 476 801 329 294 41 438 LiabilitiesDeposits 59,616 44,722 32,146 23,545 27,664 29,080 36,168 16,397 11,625 26,589 10,587 14,981 11,598 3,947 7,441 3,523 Paid-up Capital 4,385 2,705 2,812 2,522 2,650 2,257 2,049 1,554 1,412 2,386 1,771 2,000 1,671 831 1,194 722 Total Capital 9,639 6,847 4,950 4,294 4,411 3,860 3,290 2,559 2,333 3,713 2,569 2,796 2,457 1,112 1,535 994

Income Statement Interest Income 5,977 4,301 3,504 2,519 2,859 3,148 2,813 1,673 1,015 2,399 1,282 1,536 1,104 408 743 322 Interest Expense 2,108 1,928 1,508 1,027 1,215 1,472 1,035 610 531 837 440 605 469 208 483 144 Net Interest Income 3,869 2,374 1,997 1,492 1,643 1,676 1,778 1,063 484 1,563 842 931 635 200 259 178 Other Income 2,079 1,277 784 690 481 661 900 546 568 832 550 670 733 265 240 374 Expenses Incl provisions 3,011 2,371 1,757 1,451 1,198 1,276 1,436 913 417 1,393 768 1,099 685 259 268 267

o/w: Salaries and Benefits 1,633 1,394 984 794 703 849 959 486 206 799 401 623 349 125 146 126 o/w: Provisions 407 (15) 104 87 67 (84) 36 99 0 153 50 78 48 10 7 16 o/w: Admin and all other 971 992 669 569 428 511 442 328 211 442 317 398 288 124 115 125

o/w: Rent expenses 221 265 216 208 163 167 160 86 60 45 123 - 88 51 40 36 Profit before tax 3,344 1,279 1,024 735 928 980 767 696 636 1,001 625 580 683 205 231 284 Tax 912 262 247 114 208 228 109 156 152 255 164 122 181 46 30 73 Profit after tax 2,433 1,017 777 621 721 752 658 539 484 746 461 458 502 159 202 211

Key YOY growth ratesAssets 35.0 23.8 22.9 8.7 26.3 27.5 39.8 42.4 18.1 33.5 11.3 36.3 22.6 31.0 41.9 68.3Loans and Advances 50.9 40.4 31.7 8.9 42.6 45.3 45.5 57.6 52.3 53.7 19.1 42.0 28.8 30.1 53.7 54.5Foreign Assets 13.9 -14.4 27.0 -37.0 -42.3 -59.0 -45.1 3.1 0.1 0.3 1802.0 218.0 -66.9 55.7 -47.5 169.0NBE Bills 32.3 20.9 19.8 7.4 10.2 17.7 52.6 27.7 32.5 45.8 13.5 40.5 28.9 31.9 39.4 58.6Deposits 37.2 24.3 24.6 14.8 28.0 26.0 40.1 40.9 13.8 33.4 6.4 37.6 21.2 32.9 49.5 63.6Paidup capital 49.0 21.4 9.7 9.1 27.6 26.7 28.3 31.3 25.5 48.5 20.1 17.0 26.1 17.1 22.9 24.5Total Capital 48.4 16.7 16.6 12.2 30.5 30.7 38.5 41.5 37.5 43.3 29.6 27.0 36.3 23.9 29.3 45.8Total Income 49.0 25.9 31.0 3.9 34.4 32.0 48.1 42.6 39.3 30.9 31.6 42.5 39.6 37.1 30.8 65.3Total Expenses 48.6 26.7 30.1 21.6 32.2 25.8 34.4 41.5 19.5 45.7 25.2 49.9 28.5 36.4 40.5 47.7Profit before tax 70.3 11.9 33.7 -30.0 40.9 38.6 14.5 44.8 85.9 6.8 46.4 41.1 63.0 38.6 6.9 100.0

Per share data Earnings per share (%) 63.2 40.8 28.9 25.6 30.8 39.2 36.4 38.0 39.8 37.4 28.7 24.7 34.3 20.7 18.5 32.3 Total Capital/Paid-up Capital 2.2 2.5 1.8 1.7 1.7 1.7 1.6 1.6 1.7 1.6 1.5 1.4 1.5 1.3 1.3 1.4

No. of: Branches 410 423 337 339 261 274 389 229 43 265 205 200 192 68 45 54 Employees 9,046 6,129 5,825 4,561 4,972 4,064 4,369 4,599 885 3,647 1,709 3,853 3,284 575 540 730

Compensation costsWages & Salaries, Birr mn 1,633 1,394 984 794 703 849 959 486 206 799 401 623 349 125 146 126 Employees 9,046 6,129 5,825 4,561 4,972 4,064 4,369 4,599 885 3,647 1,709 3,853 3,284 575 540 730 Average monthly salary, Birr 15,040 18,959 14,080 14,511 11,781 17,402 18,292 8,798 19,364 18,250 19,553 13,471 8,855 18,044 22,580 14,348

Source: Cepheus Research compilaton based on Banks's Annual Reports



24

Private Banks Overview: FY 2018-19

Balance Sheet Ratios (%) AIB DB BOA WB NIB UB CBO LIB ZB OIB Bunna Berhan Abay Addis Enat DGBLoans/Assets 63 58 60 54 57 60 51 57 52 48 56 52 50 48 55 44 Loans/Deposits 78.6 72.4 72.9 68.4 69.6 74.3 59.2 70.9 65.5 57.6 77.0 67.0 65.5 67.1 68.5 68.2 Assets/Total Equity 774 821 794 693 764 926 1,270 797 630 856 564 686 615 496 599 552 Deposits/Liabilities 92 91 94 92 94 91 94 92 94 95 89 91 92 90 97 78 Capital Ratio (%)Capital/Assets 13 12 13 14 13 11 8 13 16 12 18 15 16 20 17 18

Deposit CompositionTotal Deposits 59,616 44,722 32,146 23,545 27,664 29,080 36,168 16,397 11,625 26,589 10,587 14,981 11,598 3,947 7,441 3,523 % Saving Deposits 61.7 68.3 66.7 54.5 64.1 55.8 63.5 74.9 54.8 48.3 75.0 55.4 70.1 42.4 46.2 54.8 % Checking Deposits 31.8 22.5 20.2 26.1 19.5 21.4 32.4 17.4 34.1 27.2 23.2 35.9 21.8 23.7 15.3 32.2 % Time Deposits 6.6 9.2 13.1 19.4 16.4 22.8 4.1 7.8 11.1 24.6 1.8 8.7 8.1 33.9 38.4 13.0

Revenue Composition (%)Net Interest Income/Income 65.0 65.0 71.8 68.4 77.4 71.7 66.4 66.1 46.0 65.3 60.5 58.1 46.4 43.0 52.0 32.2Non-interest-Income/Income 35.0 35.0 28.2 31.6 22.6 28.3 33.6 33.9 54.0 34.7 39.5 41.9 53.6 57.0 48.0 67.8

Cost Ratios (%)Costs (exc int)/Income 37.4 42.5 41.0 45.2 35.9 33.5 38.7 41.1 26.3 43.1 41.9 49.8 37.3 38.5 27.3 38.4 Costs (exc int)/Avg Assets 4.6 4.7 4.9 5.1 4.0 4.0 4.0 5.3 3.1 5.0 5.6 6.6 5.0 5.3 3.4 6.1 Personnel Expenses/Total Exp 31.9 32.4 30.1 32.0 29.1 30.9 38.8 31.9 21.7 35.8 33.2 36.6 30.2 26.7 19.5 30.6 Rent Expenses/Total Exp 4.3 6.2 6.6 8.4 6.8 6.1 6.5 5.7 6.3 2.0 10.2 - 7.6 10.8 5.4 8.8 Provision Expenses/Total Exp 8.0 (0.4) 3.2 3.5 2.8 (3.1) 1.4 6.5 0.0 6.9 4.1 4.6 4.2 2.2 0.9 4.0 Effective Tax Rate 27.3 20.5 24.1 15.5 22.4 23.2 14.2 22.5 23.9 25.5 26.2 21.1 26.6 22.4 12.9 25.8

MarginsEffective Deposit Rate 4.1 4.8 5.2 4.7 4.9 5.6 3.3 4.4 4.9 3.6 4.3 4.7 4.4 6.0 6.9 5.1 Effective Lending Rate (incl Bills) 12.2 11.0 12.7 11.4 12.5 12.6 11.3 12.6 11.1 12.9 12.1 12.6 11.3 12.4 12.7 11.2 Spread 8.2 6.3 7.5 6.8 7.5 6.9 8.0 8.3 6.2 9.3 7.9 7.9 6.9 6.4 5.7 6.2 NIM 7.9 6.1 7.3 6.8 7.2 6.7 7.1 8.0 5.3 8.4 8.0 7.6 6.5 6.1 4.4 6.2

Profitability Ratios (%)RoAA 3.1 2.0 2.2 2.2 2.4 2.6 3.2 3.1 3.6 2.7 3.3 2.3 3.7 3.3 2.6 4.8 RoAE 25.1 16.0 16.9 15.2 18.4 24.5 23.4 24.7 23.7 23.7 20.2 15.2 23.5 15.8 14.8 25.1 EPS 63.2 40.8 28.9 25.6 30.8 39.2 36.4 38.0 39.8 37.4 28.7 24.7 34.3 20.7 18.5 32.3

Efficiency RatiosBranch productivity (Birr mns)

Deposit per branch 145.4 105.7 95.4 69.5 106.0 106.1 93.0 71.6 270.3 100.3 51.6 74.9 60.4 58.0 165.4 65.2Revenue per branch 19.6 13.2 12.7 9.5 12.8 13.9 9.5 9.7 36.8 12.2 8.9 11.0 9.6 9.9 21.8 12.9Profit per branch 5.9 2.4 2.3 1.8 2.8 2.7 1.7 2.4 11.3 2.8 2.3 2.3 2.6 2.3 4.5 3.9

Employee productivity (Birr '000s)Revenue per employee 890.6 910.1 736.3 703.6 671.6 937.3 849.9 482.3 1,788.7 886.0 1,072.0 572.6 559.4 1,169.3 1,819.7 952.4 Profit per employee 268.9 165.9 133.4 136.1 145.0 185.1 150.6 117.2 546.6 204.5 270.0 118.8 152.7 277.0 373.4 288.7




25

Private Banks: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 155,097 190,510 259,716 348,597 447,000 Loans/Assets 47.3 48.3 49.4 50.0 54.1Loans and Advances 74,595 91,386 132,579 178,801 251,483 Loans/Deposits 63.4 64.0 64.5 64.1 68.9NBE Bills 36,276 41,739 53,568 71,262 89,951 Assets/Total Equity 674.3 686.5 741.3 750.4 739.9 Foreign Assets 6,419 8,871 10,999 10,959 11,104 Deposits/Liabilities 88.9 89.6 89.5 91.3 91.6Liabilities Capital Ratio(%)Deposits 117,946 146,547 201,839 278,532 359,629 Capital/Assets 15.6 15.5 14.4 14.1 14.2Paid-up Capital 13,008 16,146 20,882 26,184 32,919 Total Capital 21,494 26,131 33,135 43,995 57,358

Deposit CompositionDeposits 117,946 146,547 201,839 278,532 359,629

Income Statement % Saving Deposits 56.4 56.2 56.9 57.9 59.8Interest Income 9,300 12,241 16,369 25,871 35,603 % Checking Deposits 30.7 29.6 27.6 27.2 25.3Interest Expense 3,589 4,729 6,392 10,344 14,620 % Time Deposits 12.8 14.1 15.6 14.9 14.9Net Interest Income 5,711 7,512 9,977 15,527 20,983 Other Income 5,665 6,415 8,376 9,287 11,649 Expenses Incl provisions 5,943 7,858 10,994 14,440 18,568 Revenue Composition (%)

o/w: Salaries and Benefits 3,008 3,995 5,803 8,230 10,575 Net Interest Income/Income 47.6 51.5 50.8 57.9 59.7o/w: Provisions 249 731 628 609 1,063 Non-interest-Income/Income 52.4 48.5 49.2 42.1 40.3o/w: Admin and all other 2,686 3,250 4,564 5,602 6,930

o/w: Rent expenses 787 1,060 1,386 1,627 1,930 Profit before tax 5,433 5,808 7,605 10,483 13,999 Cost Ratios (%)Tax 1,337 1,353 1,791 2,364 3,260 Costs (exc int)/Income 41.7 41.7 44.9 40.9 38.6Profit after tax 4,094 4,456 5,739 8,119 10,739 Costs (exc int)/Avg Assets 4.7 4.9 5.2 4.9 4.8

Personnel Expenses/Total Exp 30.5 31.1 32.3 31.7 30.7Rent Expenses/Total Exp 9.7 9.6 9.2 7.0 6.4

Key YOY growth rates Provision Expenses/Total Exp 3.2 5.8 3.5 2.7 3.1Assets 35.8 30.2 40.5 35.8 30.6 Effective Tax Rate 24.0 21.7 22.7 22.7 22.1Loans and Advances 55.8 35.0 43.4 38.2 41.1 Foreign Assets 153.7 64.4 111.4 21.6 123.6 NBE Bills 60.9 32.5 33.6 43.9 30.0 MarginsDeposits 40.4 31.1 42.3 39.0 30.9 Effective Deposit Rate 3.4 3.7 3.9 4.5 4.8Paidup capital 23.6 27.3 32.9 29.8 25.3 Effective Lending Rate (incl Bills) 10.2 10.5 10.4 11.9 12.0Total Capital 27.3 28.2 30.9 34.3 31.7 Spread 6.8 6.8 6.5 7.4 7.2Total Income 41.7 37.0 34.0 44.9 36.5 NIM 6.3 6.5 6.2 6.9 6.8Total Expenses 46.9 39.0 44.4 44.0 34.7 Profit before tax 36.3 33.8 60.5 49.7 38.3

Profitability Ratios (%)RoAA 3.1 3.1 2.6 2.8 2.9

Per share data RoAE 19.7 20.3 17.8 20.2 20.4Earnings per share (%) 30.8 29.5 28.4 31.2 33.7 EPS 30.8 29.5 28.4 31.2 33.7Total Capital/Paid-up Capital 1.5 1.5 1.5 1.6 1.6

No. of: Efficiency RatiosBranches 1,535 2,008 2,658 3,162 3,734 Branch productivity (Birr mns)Employees 32,171 37,396 43,574 54,776 58,788 Deposit per branch 88.6 93.8 95.8 100.5 102.4

Revenue per branch 11.5 12.3 12.3 12.9 14.0Compensation costs Profit per branch 3.2 3.2 3.0 3.0 3.4Wages & Salaries, Birr mns 3,008 3,995 5,803 8,230 10,575 Employee productivity (Birr '000s)Employees 32,171 37,396 43,574 54,776 58,788 Revenue per employee 548.9 608.4 677.1 787.5 937.6 Average monthly salary, Birr 7,792 8,902 11,098 12,521 14,991 Profit per employee 150.6 152.2 157.2 181.8 220.9

DATA IN USD TERMS:

Balance Sheet, USD mns 2014-15 2015-16 2016-17 2017-18 2018-19 Income Statement, USD mns 2014-15 2015-16 2016-17 2017-18 2018-19

Assets 7,541$ 8,739$ 11,239$ 12,787$ 15,462$ Interest Income 462$ 579$ 729$ 986$ 1,266$ Loans and Advances 3,627$ 4,192$ 5,737$ 6,559$ 8,699$ Interest Expense 178$ 224$ 285$ 394$ 520$ NBE Bills 1,764$ 1,915$ 2,318$ 2,614$ 3,111$ Net Interest Income 284$ 355$ 444$ 592$ 746$ Foreign Assets 312$ 407$ 476$ 402$ 384$ Other Income 281$ 303$ 373$ 354$ 414$ Liabilities Expenses Incl provisions 295$ 371$ 489$ 551$ 660$ Deposits 5,735$ 6,722$ 8,735$ 10,217$ 12,440$ Profit before tax 270$ 275$ 339$ 400$ 498$ Paid-up Capital 633$ 741$ 904$ 960$ 1,139$ Tax 66$ 64$ 80$ 90$ 116$ Total Capital 1,045$ 1,199$ 1,434$ 1,614$ 1,984$ Profit after tax 203$ 211$ 255$ 310$ 382$

Exchange rate, end-period 20.6 21.8 23.1 27.3 28.9 Exchange rate, year-avg 20.1 21.2 22.5 26.2 28.1




26

Awash Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 25,210 31,148 41,975 55,268 74,635 Loans/Assets 48.7 48.8 53.0 56.2 62.8Loans and Advances 12,265 15,215 22,247 31,049 46,855 Loans/Deposits 66.2 66.6 72.7 71.5 78.6NBE Bills 5,365 5,306 6,885 8,479 11,221 Assets/Total Equity 791.5 791.8 872.8 850.8 774.3Foreign Assets 1,134 1,758 2,477 2,970 3,385 Deposits/Liabilities 84.1 83.9 82.3 89.1 91.7Liabilities Capital Ratio (%)Deposits 18,520 22,832 30,591 43,451 59,616 Capital/Assets 12.6 12.6 11.5 11.8 12.9Paid-up Capital 1,777 2,243 2,645 2,944 4,385 Total Capital 3,185 3,934 4,809 6,496 9,639


Income Statement % Saving Deposits 66.7 65.5 65.8 62.9 61.7Interest Income 1,461 1,922 2,588 4,202 5,977 % Checking Deposits 22.9 25.1 26.9 29.9 31.8Interest Expense 639 782 914 1,479 2,108 % Time Deposits 10.4 9.4 7.2 7.2 6.6Net Interest Income 822 1,140 1,674 2,723 3,869 Other Income 839 901 1,176 1,206 2,079 Expenses Incl provisions 801 1,273 1,499 1,964 3,011 Revenue Composition (%)

o/w: Salaries and Benefits 467 615 848 1,234 1,633 Net Interest Income/Income 49.5 55.9 58.7 69.3 65.0o/w: Provisions 8 236 94 5 407 Non-interest-Income/Income 50.5 44.1 41.3 30.7 35.0o/w: Admin and all other 326 422 557 725 971

o/w: Rent expenses 93 116 145 182 221 Profit before tax 861 986 1,350 1,964 3,344 Cost Ratios (%)Tax 216 244 347 472 912 Costs (exc int)/Income 34.8 45.1 39.8 36.3 37.4Profit after tax 645 744 1,003 1,492 2,433 Costs (exc int)/Avg Assets 3.4 4.5 4.1 4.1 4.6


Key YOY growth rates (%) Provision Expenses/Total Exp 0.6 11.5 3.9 0.2 8.0Assets 14.0 23.6 34.8 31.7 35.0 Effective Tax Rate 25.1 24.7 25.7 24.0 27.3Loans and Advances 36.8 24.1 46.2 39.6 50.9 Foreign Assets (32.7) 55.0 40.9 19.9 13.9 NBE Bills 31.9 (1.1) 29.8 23.2 32.3 Margins (%)Deposits 23.1 23.3 34.0 42.0 37.2 Effective Deposit Rate 3.8 3.8 3.4 4.0 4.1Paidup capital 27.5 26.2 17.9 11.3 49.0 Effective Lending Rate (incl Bills) 9.5 10.1 10.4 12.2 12.2Total Capital 22.6 23.5 22.2 35.1 48.4 Spread 5.7 6.3 7.0 8.2 8.2Total Income 19.7 22.7 33.3 43.7 49.0 NIM 5.4 6.0 6.7 7.9 7.9Total Expenses 31.7 42.7 17.4 42.7 48.6 Profit before tax 3.9 14.5 36.9 45.5 70.3


Per share data (ETB) RoAE 22.3 14.7 23.0 25.0 25.1Earnings per share (%) 44.5 37.1 40.9 54.3 63.2 EPS 44.5 37.1 40.9 54.3 63.2Total Capital/Paid-up Capital 1.8 1.8 1.8 2.2 2.2

No. of: Efficiency RatiosBranches 202 240 316 366 410 Branch productivity (Birr mns)Employees 5,847 6,003 6,772 7,881 9,046 Deposit per branch 91.7 95.1 96.8 118.7 145.4

Revenue per branch 11.4 11.8 11.9 14.8 19.6Compensation costs Profit per branch 3.2 3.1 3.2 4.1 5.9Wages & Salaries, Birr mns 467 615 848 1,234 1,633 Employee productivity (Birr '000s)Employees 5,847 6,003 6,772 7,881 9,046 Revenue per employee 393.4 470.3 555.8 686.2 890.6Average monthly salary, Birr 6,656 8,537 10,435 13,052 15,040 Profit per employee 110.3 123.9 148.1 189.4 268.9

DATA IN USD TERMS:


Assets 1,226$ 1,429$ 1,816$ 2,027$ 2,582$ Interest Income 73$ 91$ 115$ 160$ 213$ Loans and Advances 596$ 698$ 963$ 1,139$ 1,621$ Interest Expense 32$ 37$ 41$ 56$ 75$ NBE Bills 261$ 243$ 298$ 311$ 388$ Net Interest Income 41$ 54$ 75$ 104$ 138$ Foreign Assets 55$ 81$ 107$ 109$ 117$ Other Income 42$ 43$ 52$ 46$ 74$ Liabilities Expenses Incl provisions 40$ 60$ 67$ 75$ 107$ Deposits 901$ 1,047$ 1,324$ 1,594$ 2,062$ Profit before tax 43$ 47$ 60$ 75$ 119$ Paid-up Capital 86$ 103$ 114$ 108$ 152$ Tax 11$ 12$ 15$ 18$ 32$ Total Capital 155$ 180$ 208$ 238$ 333$ Profit after tax 32$ 35$ 45$ 57$ 87$


Source: Awash Bank Annual Reports and Cepheus Research compilation



27

Dashen Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 24,763 28,576 34,624 45,425 56,218 Loans/Assets 45.8 43.7 51.2 50.8 62.8Loans and Advances 11,333 12,478 17,717 23,058 32,366 Loans/Deposits 57.2 54.8 63.8 64.1 78.6NBE Bills 5,811 6,430 8,217 10,169 12,295 Assets/Total Equity 846.9 825.9 867.1 774.3 774.3Foreign Assets 1,506 1,813 2,177 1,346 1,152 Deposits/Liabilities 90.7 90.6 90.7 91.0 91.7Liabilities Capital Ratio (%)Deposits 19,814 22,758 27,782 35,987 44,722 Capital/Assets 11.8 12.1 11.5 12.9 12.9Paid-up Capital 1,239 1,492 1,927 2,227 2,705 Total Capital 2,924 3,460 3,993 5,867 6,847


Income Statement % Saving Deposits 68.6 66.9 66.6 63.6 61.7Interest Income 1,414 1,522 2,070 3,244 4,301 % Checking Deposits 24.0 26.1 24.3 23.1 31.8Interest Expense 667 741 1,017 1,433 1,928 % Time Deposits 7.4 7.0 9.1 13.3 6.6Net Interest Income 747 781 1,053 1,811 2,374 Other Income 1,101 1,212 1,344 1,186 1,277 Expenses Incl provisions 884 1,042 1,514 1,960 2,371 Revenue Composition (%)

o/w: Salaries and Benefits 501 569 788 1,095 1,394 Net Interest Income/Income 40.4 39.2 43.9 60.4 65.0o/w: Provisions 13 29 132 105 (15) Non-interest-Income/Income 59.6 60.8 56.1 39.6 35.0o/w: Admin and all other 370 444 594 760 992

o/w: Rent expenses 94 121 193 241 265 Profit before tax 964 951 979 1,143 1,279 Cost Ratios (%)Tax 235 224 223 214 262 Costs (exc int)/Income 35.1 38.1 44.3 44.2 37.4Profit after tax 729 727 756 929 1,017 Costs (exc int)/Avg Assets 3.8 3.9 4.8 4.8 4.6


Key YOY growth rates (%) Provision Expenses/Total Exp 0.8 1.6 5.2 3.1 8.0Assets 12.8 15.4 21.2 31.2 23.8 Effective Tax Rate 24.4 23.6 22.8 18.7 20.5Loans and Advances 20.2 10.1 42.0 30.1 40.4 Foreign Assets (34.7) 20.4 20.1 (38.2) (14.4) NBE Bills 42.1 10.7 27.8 23.8 20.9 Margins (%)Deposits 12.1 14.9 22.1 29.5 24.3 Effective Deposit Rate 3.6 3.5 4.0 4.5 4.1Paidup capital 16.4 20.4 29.2 15.6 21.4 Effective Lending Rate (incl Bills) 9.2 8.4 9.2 10.9 12.2Total Capital 12.5 18.3 15.4 46.9 16.7 Spread 5.7 5.0 5.2 6.4 8.2Total Income 17.2 8.7 24.9 29.8 25.9 NIM 4.9 4.3 4.7 6.1 7.9Total Expenses 30.7 15.0 41.9 34.1 26.7 Profit before tax 0.6 (1.3) 2.9 16.8 11.9




Revenue per branch 16.1 12.4 11.3 11.9 19.6Compensation costs Profit per branch 4.7 3.3 2.5 2.5 5.9Wages & Salaries, Birr mns 501 569 788 1,095 1,394 Employee productivity (Birr '000s)Employees 4,597 5,630 7,297 8,950 6,129 Revenue per employee 547.1 485.6 467.9 495.0 910.1Average monthly salary, Birr 9,082 8,422 8,999 10,196 18,959 Profit per employee 158.6 129.1 103.6 103.8 165.9

DATA IN USD TERMS:


Assets 1,204$ 1,311$ 1,498$ 1,666$ 1,945$ Interest Income 70$ 72$ 92$ 124$ 153$ Loans and Advances 551$ 572$ 767$ 846$ 1,120$ Interest Expense 33$ 35$ 45$ 55$ 69$ NBE Bills 283$ 295$ 356$ 373$ 425$ Net Interest Income 37$ 37$ 47$ 69$ 84$ Foreign Assets 73$ 83$ 94$ 49$ 40$ Other Income 55$ 57$ 60$ 45$ 45$ Liabilities Expenses Incl provisions 44$ 49$ 67$ 75$ 84$ Deposits 963$ 1,044$ 1,202$ 1,320$ 1,547$ Profit before tax 48$ 45$ 44$ 44$ 45$ Paid-up Capital 60$ 68$ 83$ 82$ 94$ Tax 12$ 11$ 10$ 8$ 9$ Total Capital 142$ 159$ 173$ 215$ 237$ Profit after tax 36$ 34$ 34$ 35$ 36$


Source: Dashen Bank Annual Reports and Cepheus Research compilation



28

Bank of Abyssinia: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 13,668 16,828 25,325 31,983 39,294 Loans/Assets 43.2 47.6 55.0 55.6 59.6Loans and Advances 5,905 8,012 13,927 17,781 23,421 Loans/Deposits 53.1 58.8 67.3 68.9 72.9NBE Bills 3,389 3,683 5,121 6,314 7,565 Assets/Total Equity 754.7 792.3 871.8 753.4 793.8Foreign Assets 448 351 279 432 549 Deposits/Liabilities 93.8 92.7 92.3 93.0 93.6Liabilities Capital Ratio (%)Deposits 11,118 13,635 20,701 25,795 32,146 Capital/Assets 13.2 12.6 11.5 13.3 12.6Paid-up Capital 1,120 1,275 1,802 2,563 2,812 Total Capital 1,811 2,124 2,905 4,245 4,950


Income Statement % Saving Deposits 68.8 68.6 60.2 62.8 66.7Interest Income 854 1,098 1,590 2,721 3,504 % Checking Deposits 23.1 25.0 28.0 21.2 20.2Interest Expense 371 453 599 1,056 1,508 % Time Deposits 8.0 6.4 11.8 15.9 13.1Net Interest Income 483 645 991 1,665 1,997 Other Income 352 536 789 553 784 Expenses Incl provisions 460 693 1,074 1,453 1,757 Revenue Composition (%)

o/w: Salaries and Benefits 239 389 615 863 984 Net Interest Income/Income 57.8 54.6 55.7 75.1 71.8o/w: Provisions (2) 19 82 118 104 Non-interest-Income/Income 42.2 45.4 44.3 24.9 28.2o/w: Admin and all other 223 285 377 471 669

o/w: Rent expenses 74 112 146 183 216 Profit before tax 374 487 704 766 1,024 Cost Ratios (%)Tax 82 107 164 203 247 Costs (exc int)/Income 38.1 42.4 45.1 44.4 41.0Profit after tax 291 380 540 563 777 Costs (exc int)/Avg Assets 3.7 4.5 5.1 5.0 4.9


Key YOY growth rates (%) Provision Expenses/Total Exp -0.2 1.7 4.9 4.7 3.2Assets 21.2 23.1 50.5 26.3 22.9 Effective Tax Rate 21.9 22.0 23.3 26.5 24.1Loans and Advances 16.7 35.7 73.8 27.7 31.7 Foreign Assets (9.3) (21.7) (20.5) 54.8 27.0 NBE Bills 25.0 8.7 39.0 23.3 19.8 Margins (%)Deposits 22.2 22.6 51.8 24.6 24.6 Effective Deposit Rate 3.7 3.7 3.5 4.5 5.2Paidup capital 21.2 13.8 41.3 42.2 9.7 Effective Lending Rate (incl Bills) 10.0 10.5 10.3 12.6 12.7Total Capital 18.4 17.3 36.8 46.1 16.6 Spread 6.3 6.8 6.9 8.1 7.5Total Income 19.1 35.5 45.6 37.6 31.0 NIM 5.7 6.1 6.4 7.7 7.3Total Expenses 25.7 37.9 46.0 50.0 30.1 Profit before tax 6.6 30.2 44.6 8.8 33.7




Revenue per branch 9.1 8.8 10.2 11.4 12.7Compensation costs Profit per branch 2.2 2.1 2.3 2.0 2.3Wages & Salaries, Birr mns 239 389 615 863 984 Employee productivity (Birr '000s)Employees 3,290 4,144 4,144 5,825 5,825 Revenue per employee 366.6 394.3 574.1 562.0 736.3Average monthly salary, Birr 6,054 7,823 12,367 12,346 14,080 Profit per employee 88.4 91.7 130.3 96.7 133.4

DATA IN USD TERMS:


Assets 665$ 772$ 1,096$ 1,173$ 1,359$ Interest Income 42$ 52$ 71$ 104$ 125$ Loans and Advances 287$ 368$ 603$ 652$ 810$ Interest Expense 18$ 21$ 27$ 40$ 54$ NBE Bills 165$ 169$ 222$ 232$ 262$ Net Interest Income 24$ 30$ 44$ 63$ 71$ Foreign Assets 22$ 16$ 12$ 16$ 19$ Other Income 17$ 25$ 35$ 21$ 28$ Liabilities Expenses Incl provisions 23$ 33$ 48$ 55$ 62$ Deposits 541$ 625$ 896$ 946$ 1,112$ Profit before tax 19$ 23$ 31$ 29$ 36$ Paid-up Capital 54$ 58$ 78$ 94$ 97$ Tax 4$ 5$ 7$ 8$ 9$ Total Capital 88$ 97$ 126$ 156$ 171$ Profit after tax 14$ 18$ 24$ 21$ 28$


Source: Bank of Abyssynia Annual Reports and Cepheus Research compilation



29

Wegagen Bank: Summary Financials, Birr mn unless otherwise stated



Income Statement % Saving Deposits 52.8 50.7 47.3 48.8 54.5Interest Income 854 1,024 1,345 2,116 2,519 % Checking Deposits 40.2 38.6 37.1 38.5 26.1Interest Expense 291 343 467 752 1,027 % Time Deposits 7.0 10.7 14.9 12.7 19.4Net Interest Income 563 681 878 1,364 1,492 Other Income 473 509 798 972 690 Expenses Incl provisions 583 709 969 1,286 1,451 Revenue Composition (%)

o/w: Salaries and Benefits 324 380 544 677 794 Net Interest Income/Income 54.3 57.2 52.4 58.4 68.4o/w: Provisions 28 40 38 61 87 Non-interest-Income/Income 45.7 42.8 47.6 41.6 31.6o/w: Admin and all other 231 289 386 547 569

o/w: Rent expenses 83 109 141 173 208 Profit before tax 453 478 708 1,050 735 Cost Ratios (%)Tax 100 103 176 257 114 Costs (exc int)/Income 43.9 46.2 45.2 41.6 45.2Profit after tax 353 375 532 794 621 Costs (exc int)/Avg Assets 4.6 4.7 5.2 5.3 5.1


Key YOY growth rates (%) Provision Expenses/Total Exp 3.2 3.8 2.7 3.0 3.5Assets 18.9 18.1 29.4 30.8 8.7 Effective Tax Rate 22.1 21.5 24.9 24.4 15.5Loans and Advances 34.1 23.6 36.4 44.5 8.9 Foreign Assets (45.4) 64.7 (83.1) 67.5 (37.0) NBE Bills 36.9 4.4 17.4 25.4 7.4 Margins (%)Deposits 21.9 16.1 31.7 31.2 14.8 Effective Deposit Rate 3.1 3.1 3.4 4.2 4.7Paidup capital 11.7 18.8 16.5 11.5 9.1 Effective Lending Rate (incl Bills) 9.6 9.3 9.9 11.6 11.4Total Capital 12.6 16.2 19.6 14.0 12.2 Spread 6.5 6.2 6.5 7.5 6.8Total Income 24.1 15.5 39.8 44.1 3.9 NIM 6.3 6.2 6.5 7.5 6.8Total Expenses 33.6 20.4 36.5 41.9 21.6 Profit before tax 9.4 5.5 48.1 48.3 (30.0)





DATA IN USD TERMS:


Assets 667$ 743$ 907$ 1,005$ 1,030$ Interest Income 42$ 48$ 60$ 81$ 90$ Loans and Advances 295$ 344$ 443$ 542$ 557$ Interest Expense 14$ 16$ 21$ 29$ 37$ NBE Bills 202$ 199$ 221$ 235$ 238$ Net Interest Income 28$ 32$ 39$ 52$ 53$ Foreign Assets 19$ 30$ 5$ 7$ 4$ Other Income 23$ 24$ 36$ 37$ 25$ Liabilities Expenses Incl provisions 29$ 34$ 43$ 49$ 52$ Deposits 497$ 544$ 676$ 752$ 814$ Profit before tax 23$ 23$ 32$ 40$ 26$ Paid-up Capital 73$ 82$ 90$ 85$ 87$ Tax 5$ 5$ 8$ 10$ 4$ Total Capital 117$ 129$ 145$ 140$ 149$ Profit after tax 18$ 18$ 24$ 30$ 22$


Source: Wegagen Bank Annual Reports and Cepheus Research compilation



30

Nib Bank: Summary Financials, Birr mn unless otherwise stated



Income Statement % Saving Deposits 55.8 52.7 55.8 60.2 64.1Interest Income 888 1,141 1,500 2,073 2,859 % Checking Deposits 30.7 33.3 29.0 22.0 19.5Interest Expense 300 392 531 876 1,215 % Time Deposits 13.5 14.0 15.0 17.8 16.4Net Interest Income 588 749 969 1,197 1,643 Other Income 310 290 447 412 481 Expenses Incl provisions 456 579 735 950 1,198 Revenue Composition (%)

o/w: Salaries and Benefits 236 291 387 554 703 Net Interest Income/Income 65.5 72.1 68.4 74.4 77.4o/w: Provisions (11) 33 42 46 67 Non-interest-Income/Income 34.5 27.9 31.6 25.6 22.6o/w: Admin and all other 231 256 306 350 428

o/w: Rent expenses 78 94 120 139 163 Profit before tax 441 459 682 659 928 Cost Ratios (%)Tax 104 102 165 144 208 Costs (exc int)/Income 38.1 40.5 37.8 38.2 35.9Profit after tax 337 357 516 515 721 Costs (exc int)/Avg Assets 3.8 4.0 4.0 4.0 4.0


Key YOY growth rates (%) Provision Expenses/Total Exp -1.5 3.4 3.3 2.5 2.8Assets 23.3 19.4 32.8 27.0 26.3 Effective Tax Rate 23.6 22.2 24.2 21.9 22.4Loans and Advances 27.5 9.0 42.6 26.0 42.6 Foreign Assets 75.6 502.1 (18.5) (93.2) (42.3) NBE Bills 40.5 10.4 22.3 22.3 10.2 Margins (%)Deposits 23.4 27.1 32.1 31.7 28.0 Effective Deposit Rate 3.4 3.5 3.7 4.6 4.9Paidup capital 5.3 18.7 19.3 15.8 27.6 Effective Lending Rate (incl Bills) 9.5 10.2 10.9 11.6 12.5Total Capital 10.8 15.7 17.3 14.4 30.5 Spread 6.1 6.7 7.2 7.0 7.5Total Income 15.3 19.4 36.1 27.6 34.4 NIM 6.3 6.7 7.1 6.7 7.2Total Expenses 21.2 28.4 30.4 44.2 32.2 Profit before tax 6.3 4.1 48.6 (3.4) 40.9





DATA IN USD TERMS:


Assets 645$ 726$ 910$ 979$ 1,166$ Interest Income 44$ 54$ 67$ 79$ 102$ Loans and Advances 335$ 345$ 464$ 495$ 666$ Interest Expense 15$ 19$ 24$ 33$ 43$ NBE Bills 184$ 191$ 221$ 229$ 238$ Net Interest Income 29$ 35$ 43$ 46$ 58$ Foreign Assets 7$ 40$ 31$ 2$ 1$ Other Income 15$ 14$ 20$ 16$ 17$ Liabilities Expenses Incl provisions 23$ 27$ 33$ 36$ 43$ Deposits 475$ 570$ 710$ 793$ 957$ Profit before tax 22$ 22$ 30$ 25$ 33$ Paid-up Capital 62$ 69$ 78$ 76$ 92$ Tax 5$ 5$ 7$ 5$ 7$ Total Capital 106$ 116$ 128$ 124$ 153$ Profit after tax 17$ 17$ 23$ 20$ 26$


Source: NIB Annual Reports and Cepheus Research compilation



31

United Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 14,361 17,270 21,903 28,031 35,736 Loans/Assets 47.2 48.8 54.1 53.0 60.5Loans and Advances 6,776 8,423 11,848 14,870 21,612 Loans/Deposits 60.7 64.6 67.0 64.4 74.3NBE Bills 4,052 4,358 4,837 6,275 7,384 Assets/Total Equity 851.8 833.5 870.5 948.9 925.9Foreign Assets 546 773 880 824 338 Deposits/Liabilities 88.1 85.8 91.2 92.0 91.2Liabilities Capital Ratio (%)Deposits 11,164 13,038 17,684 23,079 29,080 Capital/Assets 11.7 12.0 11.5 10.5 10.8Paid-up Capital 975 1,252 1,558 1,781 2,257 Total Capital 1,686 2,072 2,516 2,954 3,860


Income Statement % Saving Deposits 62.3 62.3 55.9 57.4 55.8Interest Income 948 1,226 1,549 2,264 3,148 % Checking Deposits 26.1 25.4 25.5 21.4 21.4Interest Expense 386 526 635 1,027 1,472 % Time Deposits 11.6 12.3 18.7 21.2 22.8Net Interest Income 562 700 914 1,237 1,676 Other Income 386 448 462 623 661 Expenses Incl provisions 590 720 887 1,157 1,276 Revenue Composition (%)

o/w: Salaries and Benefits 316 399 525 679 849 Net Interest Income/Income 59.3 61.0 66.4 66.5 71.7o/w: Provisions 11 27 37 99 (84) Non-interest-Income/Income 40.7 39.0 33.6 33.5 28.3o/w: Admin and all other 263 294 325 380 511



Key YOY growth rates (%) Provision Expenses/Total Exp 1.1 2.2 2.4 4.5 -3.1Assets 20.9 20.3 26.8 28.0 27.5 Effective Tax Rate 21.5 21.0 21.9 18.8 23.2Loans and Advances 35.6 24.3 40.7 25.5 45.3 Foreign Assets (34.0) 41.6 13.8 (6.4) (59.0) NBE Bills 41.3 7.6 11.0 29.7 17.7 Margins (%)Deposits 25.3 16.8 35.6 30.5 26.0 Effective Deposit Rate 3.8 4.3 4.1 5.0 5.6Paidup capital 8.6 28.4 24.4 14.3 26.7 Effective Lending Rate (incl Bills) 10.1 10.4 10.5 11.9 12.6Total Capital 7.0 22.9 21.4 17.4 30.7 Spread 6.3 6.0 6.5 6.9 6.9Total Income 28.1 25.5 20.1 43.6 32.0 NIM 6.0 5.9 6.2 6.5 6.7Total Expenses 43.7 27.7 22.2 43.5 25.8 Profit before tax (0.8) 19.8 14.0 44.6 38.6





DATA IN USD TERMS:


Assets 698$ 792$ 948$ 1,028$ 1,236$ Interest Income 47$ 58$ 69$ 86$ 112$ Loans and Advances 329$ 386$ 513$ 545$ 748$ Interest Expense 19$ 25$ 28$ 39$ 52$ NBE Bills 197$ 200$ 209$ 230$ 255$ Net Interest Income 28$ 33$ 41$ 47$ 60$ Foreign Assets 27$ 35$ 38$ 30$ 12$ Other Income 19$ 21$ 21$ 24$ 24$ Liabilities Expenses Incl provisions 29$ 34$ 39$ 44$ 45$ Deposits 543$ 598$ 765$ 847$ 1,006$ Profit before tax 18$ 20$ 22$ 27$ 35$ Paid-up Capital 47$ 57$ 67$ 65$ 78$ Tax 4$ 4$ 5$ 5$ 8$ Total Capital 82$ 95$ 109$ 108$ 134$ Profit after tax 14$ 16$ 17$ 22$ 27$


Source: United Bank Annual Reports and Cepheus Research compilation



32

Cooperative Bank of Oromia: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 11,538 10,687 17,724 29,888 41,791 Loans/Assets 56.9 54.8 54.6 49.2 51.2Loans and Advances 6,566 5,852 9,680 14,712 21,405 Loans/Deposits 89.1 68.9 67.8 57.0 59.2NBE Bills 1,505 1,776 3,299 5,424 8,279 Assets/Total Equity 775.9 875.3 1168.4 1258.1 1270.4Foreign Assets 502 232 318 669 367 Deposits/Liabilities 73.3 89.7 88.1 93.8 93.9Liabilities Capital Ratio (%)Deposits 7,368 8,488 14,277 25,808 36,168 Capital/Assets 12.9 11.4 8.6 7.9 7.9Paid-up Capital 865 911 1,000 1,597 2,049 Total Capital 1,487 1,221 1,517 2,376 3,290


Income Statement % Saving Deposits 53.8 56.1 62.2 61.1 63.5Interest Income 702 864 1,117 1,850 2,813 % Checking Deposits 43.6 34.9 33.2 35.9 32.4Interest Expense 137 229 336 620 1,035 % Time Deposits 2.6 7.9 4.6 3.0 4.1Net Interest Income 565 635 781 1,230 1,778 Other Income 524 255 409 658 900 Expenses Incl provisions 532 437 949 1,218 1,436 Revenue Composition (%)

o/w: Salaries and Benefits 162 189 415 700 959 Net Interest Income/Income 51.9 71.3 65.6 65.1 66.4o/w: Provisions 104 153 - (66) 36 Non-interest-Income/Income 48.1 28.7 34.4 34.9 33.6o/w: Admin and all other 266 212 534 584 442

o/w: Rent expenses 53 72 96 122 160 Profit before tax 557 37 239 670 767 Cost Ratios (%)Tax 169 (2) 28 146 109 Costs (exc int)/Income 43.4 39.1 62.2 48.6 38.7Profit after tax 388 39 207 523 658 Costs (exc int)/Avg Assets 5.6 3.9 6.7 5.1 4.0


Key YOY growth rates (%) Provision Expenses/Total Exp 15.5 23.0 0.0 -3.6 1.4Assets 57.0 (7.4) 65.8 68.6 39.8 Effective Tax Rate 30.3 -5.4 11.7 21.9 14.2Loans and Advances 80.2 (10.9) 65.4 52.0 45.5 Foreign Assets 70.7 (53.8) 37.1 110.5 (45.1) NBE Bills 79.2 18.0 85.8 64.4 52.6 Margins (%)Deposits 35.2 15.2 68.2 80.8 40.1 Effective Deposit Rate 2.1 2.9 3.0 3.1 3.3Paidup capital 36.9 5.3 9.8 59.7 28.3 Effective Lending Rate (incl Bills) 11.2 11.0 10.8 11.2 11.3Total Capital 36.4 (17.9) 24.2 56.6 38.5 Spread 9.0 8.1 7.9 8.1 8.0Total Income 39.0 (8.7) 36.4 64.4 48.1 NIM 9.0 8.1 7.6 7.5 7.1Total Expenses 64.8 (0.4) 93.0 43.0 34.4 Profit before tax 17.0 (93.4) 545.9 180.3 14.5





DATA IN USD TERMS:


Assets 561$ 490$ 767$ 1,096$ 1,446$ Interest Income 35$ 41$ 50$ 71$ 100$ Loans and Advances 319$ 268$ 419$ 540$ 740$ Interest Expense 7$ 11$ 15$ 24$ 37$ NBE Bills 73$ 81$ 143$ 199$ 286$ Net Interest Income 28$ 30$ 35$ 47$ 63$ Foreign Assets 24$ 11$ 14$ 25$ 13$ Other Income 26$ 12$ 18$ 25$ 32$ Liabilities Expenses Incl provisions 26$ 21$ 42$ 46$ 51$ Deposits 358$ 389$ 618$ 947$ 1,251$ Profit before tax 28$ 2$ 11$ 26$ 27$ Paid-up Capital 42$ 42$ 43$ 59$ 71$ Tax 8$ (0)$ 1$ 6$ 4$ Total Capital 72$ 56$ 66$ 87$ 114$ Profit after tax 19$ 2$ 9$ 20$ 23$


Source: CBO Annual Reports and Cepheus Research compilation



33

Lion Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 5,859 8,119 10,976 14,320 20,392 Loans/Assets 48.3 53.0 50.0 51.5 57.0Loans and Advances 2,830 4,303 5,486 7,374 11,622 Loans/Deposits 63.5 67.9 62.5 63.4 70.9NBE Bills 1,237 1,679 2,387 3,312 4,230 Assets/Total Equity 712.8 758.8 757.5 791.6 796.7Foreign Assets 504 219 261 33 34 Deposits/Liabilities 88.5 89.9 92.1 93.0 92.0Liabilities Capital Ratio (%)Deposits 4,457 6,334 8,775 11,640 16,397 Capital/Assets 14.0 13.2 13.2 12.6 12.6Paid-up Capital 510 642 938 1,184 1,554 Total Capital 822 1,070 1,449 1,809 2,559


Income Statement % Saving Deposits 58.7 64.2 67.7 70.7 74.9Interest Income 327 527 764 1,173 1,673 % Checking Deposits 30.8 27.6 20.5 20.7 17.4Interest Expense 107 170 241 424 610 % Time Deposits 10.5 8.3 11.4 8.6 7.8Net Interest Income 220 357 523 749 1,063 Other Income 312 368 279 383 546 Expenses Incl provisions 256 376 451 652 913 Revenue Composition (%)


o/w: Rent expenses 33 46 59 - 86 Profit before tax 276 350 351 480 696 Cost Ratios (%)Tax 75 88 82 90 156 Costs (exc int)/Income 40.1 42.0 43.2 41.9 41.1Profit after tax 201 261 268 391 539 Costs (exc int)/Avg Assets 5.4 5.4 4.7 5.2 5.3


Key YOY growth rates (%) Provision Expenses/Total Exp 8.3 7.1 3.8 4.7 6.5Assets 62.2 38.6 35.2 30.5 42.4 Effective Tax Rate 27.2 25.1 23.4 18.7 22.5Loans and Advances 83.6 52.0 27.5 34.4 57.6 Foreign Assets 581.1 (56.5) 19.2 (87.4) 3.1 NBE Bills 72.8 35.7 42.2 38.7 27.7 Margins (%)Deposits 65.9 42.1 38.5 32.6 40.9 Effective Deposit Rate 3.0 3.2 3.2 4.1 4.4Paidup capital 14.1 25.9 46.1 26.2 31.3 Effective Lending Rate (incl Bills) 10.3 10.5 11.0 12.7 12.6Total Capital 30.9 30.2 35.4 24.8 41.5 Spread 7.3 7.3 7.8 8.5 8.3Total Income 86.8 40.1 16.5 49.2 42.6 NIM 7.0 7.1 7.5 8.1 8.0Total Expenses 68.8 50.4 26.7 55.4 41.5 Profit before tax 117.3 26.8 0.3 36.8 44.8





DATA IN USD TERMS:


Assets 285$ 372$ 475$ 525$ 705$ Interest Income 16$ 25$ 34$ 45$ 59$ Loans and Advances 138$ 197$ 237$ 270$ 402$ Interest Expense 5$ 8$ 11$ 16$ 22$ NBE Bills 60$ 77$ 103$ 121$ 146$ Net Interest Income 11$ 17$ 23$ 29$ 38$ Foreign Assets 25$ 10$ 11$ 1$ 1$ Other Income 15$ 17$ 12$ 15$ 19$ Liabilities Expenses Incl provisions 13$ 18$ 20$ 25$ 32$ Deposits 217$ 291$ 380$ 427$ 567$ Profit before tax 14$ 17$ 16$ 18$ 25$ Paid-up Capital 25$ 29$ 41$ 43$ 54$ Tax 4$ 4$ 4$ 3$ 6$ Total Capital 40$ 49$ 63$ 66$ 89$ Profit after tax 10$ 12$ 12$ 15$ 19$


Source: LIon Bank Annual Reports and Cepheus Research compilation



34

Zemen Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 4,874 7,374 9,669 12,439 14,689 Loans/Assets 44.3 44.1 41.1 40.2 51.8Loans and Advances 2,157 3,254 3,971 4,995 7,610 Loans/Deposits 56.5 59.3 54.2 48.9 65.5NBE Bills 1,358 1,632 2,006 2,419 3,205 Assets/Total Equity 637.1 735.9 735.3 733.0 629.7Foreign Assets 444 1,075 1,133 1,463 1,465 Deposits/Liabilities 92.9 86.1 87.7 95.1 94.1Liabilities Capital Ratio (%)Deposits 3,819 5,487 7,328 10,218 11,625 Capital/Assets 15.7 13.6 13.6 13.6 15.9Paid-up Capital 500 650 850 1,125 1,412 Total Capital 765 1,002 1,315 1,697 2,333


Income Statement % Saving Deposits 60.1 49.5 58.8 61.0 54.8Interest Income 263 367 463 712 1,015 % Checking Deposits 26.7 28.2 26.4 29.0 34.1Interest Expense 137 207 295 442 531 % Time Deposits 13.1 22.3 14.7 10.0 11.1Net Interest Income 126 160 168 270 484 Other Income 239 336 503 424 568 Expenses Incl provisions 165 199 316 352 417 Revenue Composition (%)

o/w: Salaries and Benefits 74 96 135 172 206 Net Interest Income/Income 34.5 32.3 25.0 38.9 46.0o/w: Provisions - 24 40 27 0 Non-interest-Income/Income 65.5 67.7 75.0 61.1 54.0o/w: Admin and all other 91 79 141 153 211



Key YOY growth rates (%) Provision Expenses/Total Exp 0.0 5.9 6.6 3.4 0.0Assets 24.2 51.3 31.1 28.6 18.1 Effective Tax Rate 23.4 24.8 25.8 20.8 23.9Loans and Advances 65.4 50.9 22.0 25.8 52.3 Foreign Assets (4.7) 142.1 5.4 29.1 0.1 NBE Bills 43.4 20.2 22.9 20.6 32.5 Margins (%)Deposits 26.0 43.7 33.6 39.4 13.8 Effective Deposit Rate 4.0 4.4 4.6 4.9 4.9Paidup capital 11.1 30.0 30.8 32.4 25.5 Effective Lending Rate (incl Bills) 9.1 8.7 8.5 10.6 11.1Total Capital 16.4 31.0 31.2 29.0 37.5 Spread 5.1 4.3 3.9 5.7 6.2Total Income 10.1 40.0 37.4 17.6 39.3 NIM 4.4 3.8 3.1 4.0 5.3Total Expenses 4.5 34.4 50.4 30.0 19.5 Profit before tax 21.8 34.3 31.9 (3.9) 85.9



No. of: Efficiency RatiosBranches 11 11 15 26 43 Branch productivity (Birr mns)Employees 438 565 735 724 885 Deposit per branch 347.2 498.8 488.5 393.0 270.3

Revenue per branch 45.6 63.9 64.4 43.7 36.8Compensation costs Profit per branch 13.9 18.5 17.6 10.4 11.3Wages & Salaries, Birr mns 74 96 135 172 206 Employee productivity (Birr '000s)Employees 438 565 735 724 885 Revenue per employee 1,146.1 1,244.2 1,314.3 1,569.1 1,788.7 Average monthly salary, Birr 14,079 14,159 15,306 19,797 19,364 Profit per employee 349.3 359.3 359.2 374.3 546.6

DATA IN USD TERMS:




Source: Zemen Bank Annual Reports and Cepheus Research compilation



35

Oromia International Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 9,535 11,282 16,293 23,797 31,779 Loans/Assets 52.1 45.8 43.2 41.9 48.2Loans and Advances 4,963 5,166 7,042 9,969 15,324 Loans/Deposits 62.0 55.3 52.5 50.0 57.6NBE Bills 1,932 2,380 3,405 4,845 7,063 Assets/Total Equity 960.2 856.0 978.0 918.4 856.0Foreign Assets 193 248 1,102 1,287 1,291 Deposits/Liabilities 93.7 93.8 91.7 94.0 94.7Liabilities Capital Ratio (%)Deposits 8,006 9,348 13,414 19,927 26,589 Capital/Assets 10.4 11.7 10.2 10.9 11.7Paid-up Capital 679 921 1,168 1,607 2,386 Total Capital 993 1,318 1,666 2,591 3,713


Income Statement % Saving Deposits 53.4 56.9 60.5 58.0 48.3Interest Income 517 763 911 1,506 2,399 % Checking Deposits 42.2 35.1 31.7 35.0 27.2Interest Expense 157 237 329 543 837 % Time Deposits 4.3 8.0 7.8 7.0 24.6Net Interest Income 360 526 582 962 1,563 Other Income 333 400 583 963 832 Expenses Incl provisions 399 584 827 987 1,393 Revenue Composition (%)


o/w: Rent expenses 43 66 9 39 45 Profit before tax 294 286 379 938 1,001 Cost Ratios (%)Tax 72 65 90 210 255 Costs (exc int)/Income 46.9 50.2 55.4 40.0 43.1Profit after tax 222 221 290 728 746 Costs (exc int)/Avg Assets 5.1 5.6 6.0 4.9 5.0


Key YOY growth rates (%) Provision Expenses/Total Exp 4.9 3.9 3.5 1.2 6.9Assets 55.0 18.3 44.4 46.1 33.5 Effective Tax Rate 24.5 22.7 23.7 22.4 25.5Loans and Advances 96.0 4.1 36.3 41.6 53.7 Foreign Assets (22.8) 28.5 344.4 16.8 0.3 NBE Bills 76.4 23.2 43.1 42.3 45.8 Margins (%)Deposits 60.0 16.8 43.5 48.6 33.4 Effective Deposit Rate 2.4 2.7 2.9 3.3 3.6Paidup capital 25.7 35.6 26.8 37.6 48.5 Effective Lending Rate (incl Bills) 9.8 10.8 10.1 11.9 12.9Total Capital 32.6 32.7 26.4 55.5 43.3 Spread 7.4 8.0 7.2 8.6 9.3Total Income 56.0 36.8 28.5 65.2 30.9 NIM 6.8 7.4 6.5 7.6 8.4Total Expenses 63.0 47.7 40.9 32.4 45.7 Profit before tax 43.4 (2.7) 32.5 147.5 6.8





DATA IN USD TERMS:


Assets 464$ 518$ 705$ 873$ 1,099$ Interest Income 26$ 36$ 41$ 57$ 85$ Loans and Advances 241$ 237$ 305$ 366$ 530$ Interest Expense 8$ 11$ 15$ 21$ 30$ NBE Bills 94$ 109$ 147$ 178$ 244$ Net Interest Income 18$ 25$ 26$ 37$ 56$ Foreign Assets 9$ 11$ 48$ 47$ 45$ Other Income 17$ 19$ 26$ 37$ 30$ Liabilities Expenses Incl provisions 20$ 28$ 37$ 38$ 50$ Deposits 389$ 429$ 580$ 731$ 920$ Profit before tax 15$ 14$ 17$ 36$ 36$ Paid-up Capital 33$ 42$ 51$ 59$ 83$ Tax 4$ 3$ 4$ 8$ 9$ Total Capital 48$ 60$ 72$ 95$ 128$ Profit after tax 11$ 10$ 13$ 28$ 27$


Source: OIB Annual Reports and Cepheus Research compilation



36

Bunna Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 4,500 6,821 9,820 13,021 14,495 Loans/Assets 53.7 53.2 53.9 52.5 56.2Loans and Advances 2,418 3,632 5,290 6,842 8,149 Loans/Deposits 69.1 67.4 70.7 68.8 77.0NBE Bills 1,019 1,586 1,010 2,870 3,257 Assets/Total Equity 663.7 709.8 725.8 656.6 564.2Foreign Assets 106 244 512 25 476 Deposits/Liabilities 91.6 91.9 88.3 90.1 88.8Liabilities Capital Ratio (%)Deposits 3,501 5,385 7,479 9,947 10,587 Capital/Assets 15.1 14.1 13.8 15.2 17.7Paid-up Capital 508 686 1,010 1,475 1,771 Total Capital 678 961 1,353 1,983 2,569


Income Statement % Saving Deposits 52.1 51.0 55.0 58.7 75.0Interest Income 308 491 631 1,033 1,282 % Checking Deposits 32.4 27.0 26.0 22.5 23.2Interest Expense 90 174 254 389 440 % Time Deposits 15.5 22.0 19.0 18.7 1.8Net Interest Income 218 317 377 644 842 Other Income 174 244 293 359 550 Expenses Incl provisions 211 310 433 576 768 Revenue Composition (%)




Key YOY growth rates (%) Provision Expenses/Total Exp 4.0 7.2 3.8 4.2 4.1Assets 49.5 51.6 44.0 32.6 11.3 Effective Tax Rate 25.8 25.2 24.2 26.2 26.2Loans and Advances 80.0 50.2 45.6 29.3 19.1 Foreign Assets (51.8) 130.2 109.8 (95.1) 1,802.0 NBE Bills 68.4 55.6 (36.3) 184.2 13.5 Margins (%)Deposits 62.7 53.8 38.9 33.0 6.4 Effective Deposit Rate 3.2 3.9 3.9 4.5 4.3Paidup capital 21.8 35.0 47.2 46.0 20.1 Effective Lending Rate (incl Bills) 11.4 11.3 11.9 12.2 12.1Total Capital 31.1 41.7 40.8 46.6 29.6 Spread 8.3 7.4 8.0 7.8 7.9Total Income 62.3 52.5 25.7 50.6 31.6 NIM 8.1 7.3 7.1 7.6 8.0Total Expenses 60.1 60.8 41.9 40.4 25.2 Profit before tax 68.5 37.4 6.0 61.1 46.4



No. of: Efficiency RatiosBranches 80 102 138 171 205 Branch productivity (Birr mns)Employees 747 938 1,167 1,396 1,709 Deposit per branch 43.8 52.8 54.2 58.2 51.6

Revenue per branch 6.0 7.2 6.7 8.1 8.9Compensation costs Profit per branch 1.7 1.8 1.5 1.8 2.3Wages & Salaries, Birr mns 87 130 190 286 401 Employee productivity (Birr '000s)Employees 747 938 1,167 1,396 1,709 Revenue per employee 645.2 783.6 791.8 997.1 1072.0Average monthly salary, Birr 9,705 11,549 13,568 17,073 19,553 Profit per employee 180.7 199.4 172.2 225.6 270.0

DATA IN USD TERMS:




Source: Bunna Bank Annual Reports and Cepheus Research compilation



37

Berehan Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 4,172 7,196 10,488 14,068 19,173 Loans/Assets 44.9 51.4 51.2 50.2 52.3Loans and Advances 1,875 3,702 5,367 7,067 10,033 Loans/Deposits 61.1 69.9 70.7 64.9 67.0NBE Bills 814 1,567 2,178 3,030 4,256 Assets/Total Equity 573.9 678.9 556.4 638.9 685.7Foreign Assets 141 271 329 252 801 Deposits/Liabilities 89.1 86.3 88.2 91.8 91.5Liabilities Capital Ratio (%)Deposits 3,069 5,296 7,592 10,889 14,981 Capital/Assets 17.4 14.7 18.0 15.7 14.6Paid-up Capital 573 731 1,396 1,709 2,000 Total Capital 727 1,060 1,885 2,202 2,796


Income Statement % Saving Deposits 57.8 57.0 62.4 53.0 55.4Interest Income 210 460 688 1,113 1,536 % Checking Deposits 33.7 33.7 25.4 36.7 35.9Interest Expense 73 134 227 417 605 % Time Deposits 8.5 9.3 12.2 10.3 8.7Net Interest Income 137 326 461 696 931 Other Income 163 326 477 435 670 Expenses Incl provisions 161 331 466 720 1,099 Revenue Composition (%)


o/w: Rent expenses 23 42 65 87 - Profit before tax 139 350 471 411 580 Cost Ratios (%)Tax 34 90 122 83 122 Costs (exc int)/Income 43.2 42.1 40.0 46.5 49.8Profit after tax 105 260 349 328 458 Costs (exc int)/Avg Assets 4.6 5.8 5.3 5.9 6.6


Key YOY growth rates (%) Provision Expenses/Total Exp 3.0 6.2 3.0 2.2 4.6Assets 48.3 72.5 45.7 34.1 36.3 Effective Tax Rate 24.5 25.7 25.9 20.2 21.1Loans and Advances 60.9 97.4 45.0 31.7 42.0 Foreign Assets 386.2 92.2 21.4 (23.4) 218.0 NBE Bills 48.8 92.5 39.0 39.1 40.5 Margins (%)Deposits 52.5 72.6 43.4 43.4 37.6 Effective Deposit Rate 2.9 3.2 3.5 4.5 4.7Paidup capital 31.7 27.6 91.0 22.4 17.0 Effective Lending Rate (incl Bills) 9.5 11.6 10.7 12.7 12.6Total Capital 31.2 45.8 77.8 16.8 27.0 Spread 6.7 8.3 7.2 8.2 7.9Total Income 24.7 110.7 48.2 32.9 42.5 NIM 6.2 8.2 7.2 7.9 7.6Total Expenses 31.5 98.9 48.8 64.1 49.9 Profit before tax 13.9 151.8 34.6 (12.7) 41.1





DATA IN USD TERMS:




Source: Berhan Bank Annual Reports and Cepheus Research compilation



38

Abay Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 4,582 6,187 8,624 12,325 15,106 Loans/Assets 50.4 49.7 49.6 47.9 50.3Loans and Advances 2,311 3,074 4,274 5,898 7,597 Loans/Deposits 63.8 63.6 62.9 61.7 65.5NBE Bills 1,040 1,546 2,015 2,628 3,386 Assets/Total Equity 639.9 643.8 649.4 683.6 614.7Foreign Assets 155 83 185 995 329 Deposits/Liabilities 93.7 92.5 93.1 90.9 91.7Liabilities Capital Ratio (%)Deposits 3,624 4,833 6,792 9,566 11,598 Capital/Assets 15.6 15.5 15.4 14.6 16.3Paid-up Capital 551 719 1,000 1,325 1,671 Total Capital 716 961 1,328 1,803 2,457


Income Statement % Saving Deposits 62.0 64.4 58.4 64.2 70.1Interest Income 285 419 549 873 1,104 % Checking Deposits 25.5 24.1 21.5 21.7 21.8Interest Expense 108 149 218 358 469 % Time Deposits 12.5 11.5 20.2 14.1 8.1Net Interest Income 177 270 331 515 635 Other Income 213 216 319 443 733 Expenses Incl provisions 222 293 401 540 685 Revenue Composition (%)




Key YOY growth rates (%) Provision Expenses/Total Exp 3.3 4.1 3.3 6.2 4.2Assets 43.3 35.0 39.4 42.9 22.6 Effective Tax Rate 25.6 23.4 23.8 24.3 26.6Loans and Advances 56.7 33.0 39.0 38.0 28.8 Foreign Assets 244.4 (46.5) 122.9 437.8 (66.9) NBE Bills 65.1 48.7 30.3 30.4 28.9 Margins (%)Deposits 43.9 33.4 40.5 40.8 21.2 Effective Deposit Rate 3.5 3.5 3.8 4.4 4.4Paidup capital 48.1 30.5 39.1 32.5 26.1 Effective Lending Rate (incl Bills) 10.4 10.5 10.0 11.8 11.3Total Capital 58.4 34.2 38.2 35.8 36.3 Spread 6.9 7.0 6.3 7.4 6.9Total Income 70.0 27.5 36.7 51.6 39.6 NIM 6.5 6.8 6.0 6.9 6.5Total Expenses 51.4 33.9 40.0 45.1 28.5 Profit before tax 121.1 14.3 29.2 69.0 63.0



No. of: Efficiency RatiosBranches 90 110 144 162 192 Branch productivity (Birr mns)Employees 876 1,058 1,249 2,689 3,284 Deposit per branch 40.3 43.9 47.2 59.0 60.4

Revenue per branch 5.5 5.8 6.0 8.1 9.6Compensation costs Profit per branch 1.4 1.3 1.3 2.0 2.6Wages & Salaries, Birr mns 100 129 193 260 349 Employee productivity (Birr '000s)Employees 876 1,058 1,249 2,689 3,284 Revenue per employee 568.5 600.2 695.0 489.4 559.4Average monthly salary, Birr 9,513 10,161 12,877 8,058 8,855 Profit per employee 143.8 138.9 151.3 117.9 152.7

DATA IN USD TERMS:




Source: Abay Bank Annual Reports and Cepheus Research compilation



39

Addis International Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 1,715 2,462 3,415 4,209 5,515 Loans/Assets 44.4 42.6 45.7 48.3 48.0Loans and Advances 762 1,050 1,562 2,035 2,649 Loans/Deposits 68.6 67.2 68.8 68.5 67.1NBE Bills 320 456 636 806 1,063 Assets/Total Equity 385.4 387.1 451.1 469.2 496.1Foreign Assets 118 165 237 189 294 Deposits/Liabilities 87.4 85.6 85.4 89.7 89.6Liabilities Capital Ratio (%)Deposits 1,110 1,563 2,271 2,970 3,947 Capital/Assets 25.9 25.8 22.2 21.3 20.2Paid-up Capital 366 516 609 710 831 Total Capital 445 636 757 897 1,112


Income Statement % Saving Deposits 41.3 42.0 40.3 43.0 42.4Interest Income 96 150 200 289 408 % Checking Deposits 29.6 27.0 29.5 33.0 23.7Interest Expense 42 63 88 135 208 % Time Deposits 29.0 31.0 30.2 24.0 33.9Net Interest Income 54 87 112 154 200 Other Income 111 145 178 202 265 Expenses Incl provisions 87 118 170 207 259 Revenue Composition (%)




Key YOY growth rates (%) Provision Expenses/Total Exp 3.1 2.2 2.4 2.4 2.2Assets 35.8 43.6 38.7 23.3 31.0 Effective Tax Rate 25.6 23.9 13.8 23.6 22.4Loans and Advances 50.9 37.8 48.8 30.3 30.1 Foreign Assets 78.8 39.8 43.6 (20.3) 55.7 NBE Bills 77.8 42.5 39.5 26.7 31.9 Margins (%)Deposits 40.2 40.8 45.3 30.8 32.9 Effective Deposit Rate 4.4 4.7 4.6 5.1 6.0Paidup capital 39.7 41.0 18.0 16.6 17.1 Effective Lending Rate (incl Bills) 10.9 11.6 10.8 11.4 12.4Total Capital 41.3 42.9 19.0 18.5 23.9 Spread 6.4 6.9 6.2 6.3 6.4Total Income 41.8 42.5 28.1 29.8 37.1 NIM 6.1 6.7 6.1 6.1 6.1Total Expenses 50.0 40.3 42.7 32.5 36.4 Profit before tax 30.0 44.9 66.4 (21.3) 38.6




Revenue per branch 6.7 7.4 7.3 8.3 9.9Compensation costs Profit per branch 1.9 2.1 1.8 1.9 2.3Wages & Salaries, Birr mns 31 47 77 97 125 Employee productivity (Birr '000s)Employees 290 360 431 516 575 Revenue per employee 713.8 819.4 877.0 950.6 1,169.3 Average monthly salary, Birr 8,908 10,880 14,888 15,585 18,044 Profit per employee 200.0 236.1 213.5 219.0 277.0

DATA IN USD TERMS:




Source: Addis Bank Annual Reports and Cepheus Research compilation



40

Enat Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 2,209 3,248 4,848 6,482 9,202 Loans/Assets 51.3 49.8 50.4 51.1 55.4Loans and Advances 1,133 1,616 2,441 3,314 5,094 Loans/Deposits 72.4 67.6 66.3 66.6 68.5NBE Bills 342 539 957 1,380 1,924 Assets/Total Equity 496.4 487.7 533.3 546.2 599.4Foreign Assets 42 112 162 79 41 Deposits/Liabilities 88.7 92.5 93.5 94.0 97.1Liabilities Capital Ratio (%)Deposits 1,565 2,389 3,681 4,976 7,441 Capital/Assets 20.1 20.5 18.8 18.3 16.7Paid-up Capital 384 565 764 971 1,194 Total Capital 445 666 909 1,187 1,535






Key YOY growth rates (%) Provision Expenses/Total Exp 5.3 3.3 4.3 1.0 0.9Assets 55.9 47.0 49.3 33.7 41.9 Effective Tax Rate 17.2 23.5 22.7 26.6 12.9Loans and Advances 123.5 42.6 51.1 35.8 53.7 Foreign Assets 1,300.0 166.7 44.6 (51.4) (47.5) NBE Bills 161.1 57.6 77.6 44.2 39.4 Margins (%)Deposits 68.5 52.7 54.1 35.2 49.5 Effective Deposit Rate 5.1 5.3 6.6 7.1 6.9Paidup capital 46.6 47.1 35.2 27.1 22.9 Effective Lending Rate (incl Bills) 11.9 10.1 10.7 12.1 12.7Total Capital 53.4 49.7 36.5 30.6 29.3 Spread 6.9 4.8 4.1 5.0 5.7Total Income 110.6 59.1 53.0 55.9 30.8 NIM 6.0 4.4 3.5 4.4 4.4Total Expenses 121.7 60.9 73.7 43.9 40.5 Profit before tax 93.9 59.4 25.5 69.1 6.9




Revenue per branch 18.0 15.0 14.2 18.8 21.8Compensation costs Profit per branch 4.8 3.8 2.9 4.0 4.5Wages & Salaries, Birr mns 27 45 71 118 146 Employee productivity (Birr '000s)Employees 195 288 402 468 540 Revenue per employee 1,015.4 1,093.8 1,199.0 1,605.3 1,819.7 Average monthly salary, Birr 11,538 13,021 14,718 21,047 22,580 Profit per employee 271.8 274.3 246.3 339.5 373.4

DATA IN USD TERMS:




Source: Enat Bank Annual Reports and Cepheus Research compilation



41

Debub Global Bank: Summary Financials, Birr mn unless otherwise stated

2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19Balance Sheet Balance Sheet Ratios (%)Assets 1,144 1,292 2,063 3,261 5,488 Loans/Assets 29.3 45.7 37.9 47.6 43.8Loans and Advances 335 591 781 1,554 2,401 Loans/Deposits 40.9 67.8 54.5 72.2 68.2NBE Bills 155 288 420 686 1,089 Assets/Total Equity 522.4 401.2 487.7 478.1 551.9Foreign Assets 42 11 130 163 438 Deposits/Liabilities 88.5 89.9 87.3 83.5 78.4Liabilities Capital Ratio (%)Deposits 819 872 1,432 2,153 3,523 Capital/Assets 19.1 24.9 20.5 20.9 18.1Paid-up Capital 198 262 351 580 722 Total Capital 219 322 423 682 994

Deposit CompositionDeposits 819 872 1,432 2,153 3,523


o/w: Salaries and Benefits 32 43 60 85 126 Net Interest Income/Income 29.2 37.8 32.3 39.2 32.2o/w: Provisions - 6 6 10 16 Non-interest-Income/Income 70.8 62.2 67.7 60.8 67.8o/w: Admin and all other 34 35 67 103 125



Key YOY growth rates (%) Provision Expenses/Total Exp 0.0 5.5 3.2 3.7 4.0Assets 30.7 12.9 59.7 58.1 68.3 Effective Tax Rate 21.7 23.5 25.0 24.9 25.8Loans and Advances 25.5 76.4 32.1 98.9 54.5 Foreign Assets (41.7) (73.8) 1,081.8 25.2 169.0 NBE Bills 63.2 85.8 45.8 63.4 58.6 Margins (%)Deposits 63.8 6.5 64.2 50.4 63.6 Effective Deposit Rate 3.2 3.0 3.5 4.5 5.1Paidup capital 11.9 32.3 34.0 65.2 24.5 Effective Lending Rate (incl Bills) 11.0 12.3 10.1 12.4 11.2Total Capital 21.0 47.0 31.4 61.2 45.8 Spread 7.8 9.3 6.6 7.9 6.2Total Income 42.9 64.5 33.1 74.5 65.3 NIM 6.1 8.6 6.3 7.7 6.2Total Expenses 47.5 25.3 58.5 61.2 47.7 Profit before tax 27.8 195.7 - 108.8 100.0




Revenue per branch 5.0 6.5 6.9 10.5 12.9Compensation costs Profit per branch 0.8 1.9 1.5 2.7 3.9Wages & Salaries, Birr mns 32 43 60 85 126 Employee productivity (Birr '000s)Employees 376 478 533 551 730 Revenue per employee 292.6 378.7 452.2 763.2 952.4Average monthly salary, Birr 7,092 7,497 9,381 12,780 14,348 Profit per employee 45.2 108.8 95.7 193.5 288.7

DATA IN USD TERMS:




Source: DGB Annual Reports and Cepheus Research compilation

Documents

Ethiopia’s Banking Sector · total new deposits mobilized by private banks (Birr 89bn) exceeded that of CBE (Birr 54bn), while private banks’ collective profits (Birr 17bn) have