Today: June 13, 2024

Foreign currency shortage forced Ethiopia’s central bank to cut bank reserves down to 5 percent

February 20, 2013

(ADDIS FORTUNE) – Regulators at the National Bank of Ethiopia (NBE) have issued a directive cutting down the reserve requirement of commercial banks to 5%, from the previous 10%.

This is the second decrease in the reserve requirement in two years, from the constant 15% three years ago.

Banks have also been given a 2-year grace period within which they are to restructure their loan portfolios, so that 40pc of loan advances comprise of short-term loans, which are due within one year.

The move by the central bank is believed to be in response to the liquidity crunch that is being experienced by banks that rely on medium (one to five year) and long-term loans.

Leave a Reply

Your email address will not be published.

Previous Story

The Vatican Rally in NYC – by Tedla Asfaw

Next Story

Tewodros Hagos: Winner of the First ‘Ethiopia Creates’ Art Prize

Latest from Blog

The Horn of Africa States the Wealth Within

Dr. Suleiman walhad June 8th, 2024 Banks are more than holders and custodians of the monies of governments and the rich. They are also more than intermediaries facilitating transactions among them and
Go toTop