I-Capital Institute Licensed as Securities Investment Advisor
I-Capital Institute plc has been licensed by the Ethiopian Capital Market Authority (ECMA) as a Securities Investment Advisor, becoming the third such entity in Ethiopia. This move aims to enhance professional advisory services for investors and issuers, boosting the country’s growing capital market.
I-Capital joins Deloitte and individual advisor Habtamu Eshetu Gebre, reflecting a competitive and evolving financial sector. ECMA encourages the public to seek advice only from licensed entities to ensure compliance and reliability.
Kuramo Capital to Manage Ethiopia’s $100M Enterprise Financing Facility
Kuramo Capital Management has been appointed fund manager for the $100 million Enterprise Financing Facility (EFF), designed to boost funding access for Ethiopian SMEs and startups. Backed by the UNDP, EFF combines direct investments and a Fund of Funds model to attract public, private, and development sector investors.
With operations set to launch fully by 2025, Kuramo will focus on mobilizing capital and deploying investments, alongside local partners Addis Alemayehu and Hilina Resom. The fund aims to drive Ethiopia’s capital market growth, empower entrepreneurs, and nurture sustainable economic development.
CBE Announces Adjustments to Loan Interest Rates and Service Fees
The Commercial Bank of Ethiopia (CBE) plans to revise its loan interest rates and service fees, affecting loan products, branch and digital banking, and international services. The adjustments aim to align with market dynamics and ensure operational sustainability.
Ethiopia Approves $4.8 Billion Extra Budget for 2024/25
Ethiopia’s parliament has approved an additional 581.98 billion birr ($4.8 billion) for the 2024/25 fiscal year, bringing total spending to 1.55 trillion birr—a 21% increase from last year.
Finance Minister Ahmed Shide stated the funds will support subsidies for fertilizers, fuel, oil, and medicine. The move follows recent economic shocks, including the pandemic, conflict in Tigray, and climate challenges.
The approval comes as Ethiopia implements economic reforms under a $3.4 billion IMF program, including a floated currency and debt restructuring efforts.
ADvTECH Acquires Ethiopia’s Flipper International School for $7.5M
ADvTECH, owner of Makini Schools, has acquired Ethiopia’s Flipper International School for $7.5 million. Founded in 1998, Flipper operates five campuses in Addis Ababa and serves approximately 3,000 students.
The acquisition aligns with ADvTECH’s strategy to expand in Africa’s growing education market. CEO Geoff Whyte emphasized the opportunity presented by Addis Ababa’s rapid urbanization.
This move marks ADvTECH’s second regional expansion since acquiring Makini Schools and establishing Crawford International School in Kenya. Flipper Schools will now benefit from ADvTECH’s expertise in academics, IT, HR, and more. Kenyan Wall street
Ethiopia’s FX Reserves Surge Amid Banking Reforms
At a EuroCham Ethiopia event, National Bank Governor Mamo Mihretu announced reforms that raised Ethiopia’s FX reserves from $3.1 billion to $5.9 billion. Key measures include adopting interest-based monetary policy, strengthening the financial sector, and transitioning to a market-determined exchange rate.
The reforms have reduced FX parallel market premiums, increased bank FX transactions, and shifted the current account balance to surplus. Governor Mamo highlighted European businesses’ role in job creation and tax revenue while assuring measures to protect low-income households and enhance financial inclusion.
The reforms received positive feedback from the FDI community, marking progress in modernizing Ethiopia’s banking sector. Fana
U.S. Launches $31M Project to Improve Sanitation and Gender Equality in Ethiopia
USAID has introduced the $31 million Markets for Sanitation (M4S) project, a five-year initiative aimed at enhancing sanitation, hygiene, and gender equality in Ethiopia. Building on the success of the Transform WASH project, M4S will benefit 5.4 million people and provide 180,000 women and girls with access to menstrual health products.
The project will promote market-based solutions, making sanitation products affordable and accessible while fostering sustainable economic growth. It is part of USAID’s $190 million WASH portfolio to improve water and sanitation systems nationwide.
National ID Now Mandatory for Banking in Ethiopia
The National Bank of Ethiopia (NBE) has mandated the use of the Fayda National ID for all banking activities to enhance security, transparency, and financial inclusion.
Key Rollout Dates:
- Jan 1, 2025: Required in Addis Ababa branches.
- July 1, 2025: Expands to major cities.
- Jan 1, 2026: Nationwide implementation.
- Dec 31, 2026: Deadline for linking existing accounts.
This initiative aims to streamline KYC processes, reduce fraud, and improve access to banking services. Customers are urged to acquire a Fayda ID to ensure uninterrupted banking.
IMF to Unlock $251M Financing for Ethiopia
The IMF staff and Ethiopian authorities have reached a staff-level agreement on policies under the $3.4 billion Extended Credit Facility (ECF). Pending approval by the IMF Executive Board, Ethiopia will access $251 million. The IMF commended the launch of a domestic interbank money market and emphasized tight monetary policies to ensure inflation stability.
Ethiopia’s Financial Stability Report Highlights Key Developments and Challenges
The National Bank of Ethiopia (NBE) released its second annual Financial Stability Report in November 2024, offering insights into the country’s financial health amid global challenges and ongoing reforms.
Ethiopia’s GDP growth projection for 2024 has been revised upward to 8.4%. Inflation has decreased from 33.8% in December 2022 to 17.5% by September 2024, with further reduction expected by 2026.
The banking sector remains stable, with strong capitalization and profitability, despite risks such as credit, liquidity, and market challenges. The launch of the Ethiopian Securities Exchange is set for late 2024, marking a significant step in the country’s financial development.
Key reforms include the introduction of a market-determined exchange rate and a shift to a market-based monetary policy aimed at price stability. You can find the full report here: Financial Stability Report_NOV2024
Commercial Bank of Ethiopia Sees Decline in Market Share
The Commercial Bank of Ethiopia’s market share has declined in the past fiscal year, according to the National Bank of Ethiopia’s latest report. In 2016, the bank’s share of total assets and deposits dropped to 47.9% and 47.1%, respectively, compared to 49.5% and 48.7% in 2015. Despite this decline, the bank still holds the largest market share in the country. Meanwhile, medium-sized banks like Awash, Abyssinia, Dashen, Oromia, and Union Bank account for 28.9% of total assets and 30.3% of deposits. Small banks collectively hold 23.3% of assets and 22.7% of deposits. Capital Ethiopia
National Bank of Ethiopia to Revise Annual Lending Limit Policy
The National Bank of Ethiopia is set to revise its policy limiting annual bank lending to 14%, a rule that has been in effect for over a year. The revision will likely lift the lending cap, following concerns from banks facing cash shortages and liquidity management challenges. While the National Bank maintains that the policy is not the cause of cash shortages, bank officials argue that lifting the limit would ease pressure on the sector. The policy change is expected to be announced soon, alongside the removal of the mandatory 20% bond purchase imposed on banks.
TeleBirr Processes Over 3.25 Trillion Birr, Reaching 51.3 Million Users
Ethio Telecom’s mobile payment system, TeleBirr, has processed more than 3.25 trillion birr since its launch in May 2021, with over 51.3 million users. CEO Frehiwot Tamiru emphasized the app’s key role in expanding financial services and its growing popularity. Ethio Telecom continues to collaborate with stakeholders to support the Digital Ethiopia 2025 Strategy.
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