The financial performance and sustainability of microfinance institutions during the current financial crisis: The case of Amhara Credit and Saving Institution (ACSI) in Ethiopia

Tilahun Aemiro, Dereje Mekonnen


The purpose of this study is to assess the financial performance of Ethiopian MFIs during the current financial crisis with particular reference to Amhara Credit and Saving Institution (ACSI), the largest MFI in the country. The global financial crisis has been spreading quickly in emerging markets, but little is known about its impact on the microfinance sector. It is in this vacuum that this study is being carried out especially within Ethiopia. The study employed a descriptive research design. The data is quantitative and obtained from the MIX market website. For data analysis, descriptive statistics such as percentages and graph are used. The result of the study indicates that there was a negative shift in the performance indicators particularly in the year 2009. The gross loan portfolio has declined by 15.73% in the year 2009. As a result a decline in ROA and ROE had occurred due to lost financial revenue. The portfolio at risk rose during 2008 and 2009 indicating deterioration of portfolio quality. The number of active borrowers (outreach) declined in the year 2009 by 4.37%. However, there was an increase in number of staff members by 5.48% in the same year. Thus, the firm’s productivity was poor during 2009.

Full Text [PDF]