It is with a great sense of pride and pleasure that I announce yet another impressive year of record in most areas of banking operations for the Bank in the year ended June 2017, for which I am immensely honored to extend my appreciation to all shareholders, Board of Directors, and all stakeholders for the overall unreserved assistance you extended towards the Bank’s achievement so far made.

Both internal and external environmental factors have affected banking operations and consequently profits. National and international compliance requirements, reduction of inward remittances, and decline in the country’s export can be cited as some of the major environmental factors that somewhat affected Banks’ performance.

However, in the operational year ended June 2017, our Bank has overcome the multi-dimensional challenges, including stiff competition in the financial sector; and has successfully achieved commendable strategic and operational results, observed in the Bank’s overall business expansion, growth as well as addition to shareholder value.

Accordingly, during the reporting period of 2016/17, the Bank has earned a gross profit of Birr 681.5 million (after deduction for provision) which is higher than last year by Birr 222.8 million (i.e. 48.6% growth). The Bank’s total asset grew by Birr 5.2 billion or 32.8% and reached Birr 21 billion. The total liability of the Bank rose to Birr 18.1 billion registering a growth of Birr 4.7 billion (35.7%) compared to previous year’s balance, of which total deposit constitutes Birr 16.4 billion (90.9%) and shows an absolute growth of Birr 3.99 billion or 32.2% compared to that of last year. This is the highest absolute growth registered during the 17 years history of the Bank. On the other hand, the Bank’s total outstanding loans & advances stood at Birr 10.9 billion at the end of 2016/17 finical year. Compared to the last year’s balance of Birr 7.6 billion, it showed net increment of Birr 3.2 billion (42.4%) during the budget year.

The Bank’s customer base has been significantly growing from year to year and reached 520,791 in the year ended June 2017, showing an absolute increment of 107,881 accounts (growth of 26.1%) from that of last year.

Beyond the commendable financial performance, the Bank has gained considerable strategic achievements where it has continued to broaden its outreach to customers through multiple service delivery channels. The branching competition in the industry is an observable reality and is becoming stronger from time to time. In line with that and with a view to sustain our expansion to regional cities as well as in Addis Ababa, the Bank has opened a total of 50 new branches in the financial year. In doing so, we have managed to raise the total number of NIB branches to 180.

The Bank continued its reach to its customers by extending its services through deploying additional ATMs, POS, and by using Mobile and Internet Banking.

With regard to Interest Free Banking services, having finalized all the necessary procedural and legal issues, the Bank has been able to launch operation. In doing so, the Bank has got encouraging results in terms of number of customers and deposits, with the deposit mobilization performance of the branches having reached Birr 322.3 million as of June 30, 2017. In line with this, all the necessary preparations are finalized to commence Profit & Loss Sharing (Mudarabah) deposit and the credit facility.

Moreover, to augment the Bank’s product variety and service quality as well as to reach those segments of the society which demand differentiated product type, a number of new and improved product types have been commenced. Among these, the nine additional deposit services, namely, Corporate Saving Account, Nib Kefo Saving Account, Prestige Saving Account, Senior Citizens Saving Account, Lucy Saving Account, Student Saving Account, Executive Special Saving Account, Children Saving Account; and Holiday, Vacation & Special Purpose Saving  Accounts (Customized) were introduced in the reporting financial year.

The 2016/17 budget year was also a year of success to the Bank with regard to asset building, particularly considering the achievement in a number of construction projects. The long awaited 33 storey Headquarters building construction contract was signed with a Chinese company named China Jiangsu International PLC in the budget year. In this regard, commendable growth and progress has been observed. Moreover, the construction projects of Hawassa branch office & multipurpose building project, Dukem branch office & multipurpose building project work, and the construction work of the Bank’s building in Hosa’ena are at commendable and promising progress.

In addition to these existing construction projects, the Bank has recently acquired an 8 storey building in a leased plot of land with a total area of 2,926 sqm around Arat Kilo (near Tourist Hotel). The newly acquired building is planned to be finalized within the current year to serve as transitional Headquarters of the Bank. The Bank also purchased a number of condominium sites to serve as branch offices.

The  Bank’s achievements registered in a number of parameters were made possible thanks to the collaborated efforts exerted by all stakeholders including the Board of Directors, Management and staff,  customers and regulators as well as the general public at large.

The annual plan and budget of 2017/18 is fairly ambitious as it seems to be overstretched. However, the plan and budget of the year shall be achieved not only by working more diligently and strategically, but also by forming synergy among the various stakeholders and through delivering excellent services with a strong sense of team spirit, belongingness, and commitment.

As a part of capacity building process and business strategy, the Bank planned to formulate the third Five-Years Strategic Plan that shall consider new structure, modern system and technology. As part of new strategy, the Bank’s existing policies & procedures shall be revised in such a way to facilitate modern customer service delivery process. In the new strategy, Human Resource Development shall be vital element, and capacity building of staff and management shall be pursued through continuous coaching & training both locally and overseas.

Finally, I would like to take this opportunity to express my gratitude to the Board of Directors for their tireless support and leadership to realize the strategic and operational objectives of the Bank. I am also pleased to express my appreciation to the Bank’s management and employees for their unreserved effort towards achieving the overall objectives and goals of the Bank. With concerted efforts of all employees, shareholders, business partners and stakeholders, I have full confidence that we will attain a remarkable result and move the Bank to a new chapter in the 2017/18 financial year.

   Kibru Fondja


 November 2017