This research considers the effect of reward system on organizational performance. Reward rnprograms helps organizations to motivate its employees in order to attain the organization rnidentified goals and objectives. Many organizations face the dilemma around what the ideal rnreward strategy should be in place in order to increase the motivation of employees and as well rnas the organizational performance. The purpose of this research was to investigate the effect of rnreward system on organizational performance. A questionnaire was developed us ing reward rncategories from the Worldat Work Total Reward Model. This was distributed to recruit rnprofessional to accountant level of employees found at Addis Ababa branch using simple random rnsampling of Carlvalhoâ€™s sample determination method. Data was gathered to comprehend the rnsatisfaction level of employees on financial and non-financial reward provided by the bank and rneffect of reward system on organizational performance. A sample of 67 respondents participated rnin the survey and their opinion was analyzed using SPSS version23. The result of the survey rnindicated that the Majority of respondents were not satisfied with both the financial and non financial reward proved by the bank. However, the majority of the respondents agreed that rnfinancial and nonfinancial reward have a direct effect on employee motivation as well as rnorganizational performance. Accordingly, the necessary conclusion was drawn and rnrecommendation suggested for corrective action to be taken in the future by the Bank.