Commercial Bank of Ethiopia

Commercial Bank of Ethiopia
Government owned
Industry Finance
Founded 1963
Headquarters Addis Ababa, Ethiopia
Products Financial services
Revenue Birr 9.9 billion (June 2014)
Total assets Birr 242.7 billion (June 2014)
Total equity Birr 10.7 billion (June 2014)
Number of employees
 18,000+ (2014)
Website www.combanketh.et

The Commercial Bank of Ethiopia (CBE) is the largest commercial bank in Ethiopia As of June 2015, it had about 303.6 billion Birr in assets and held approximately 67% of deposits and about 53% of all bank loans in the country. The bank has around 22,908 employees, who staff its headquarters and its over 1000+ branches positioned in the main cities and regional towns.[1] The latter include 120 branches in the national capital Addis Ababa. With the opening of a branch in the Gechi in the Illubabor Zone of the Oromia Region, CBE's banking network has reached online 783 branches. The bank has reached 1014 branches as of February 12, 2016.

The bank also operates two branches in South Sudan, and is contemplating opening re-opening a branch in Djibouti, andopening branches in Dubai and Washington, DC, all to serve the Ethiopian diaspora.

The bank is pioneer to introduce modern banking to Ethiopia and credited for playing a catalytic role in the economic progress and development of the country. It is also the first bank in Ethiopia to introduce ATM service for local users.[2]

History

A Commercial Bank of Ethiopia building in Addis Ababa.

After the Ethiopian-English victory over Fascist Italy, the new government established the State Bank of Ethiopia a proclamation issued in August 1942. State Bank of Ethiopia commenced full operations on 15 April 1943 with two branches and 43 staff. It served both as the Ethiopia's central bank with the power to issue bank notes and coins as the agent of the Ministry of Finance, and as the principal commercial bank in the country. In 1945 the Ethiopian government granted the bank the sole right of issuing currency. The first governor of the bank was an American, George Blowers. He inaugurated the new national currency, which, owed its successful introduction to the United States. The United States provided the silver for 50 cent coins, whose intrinsic value ensured popular acceptance of the new paper money to a population used to the circulation of the silver Maria Theresa thaler.

In 1958, the State Bank of Ethiopia established a branch in Khartoum, Sudan, that the Sudanese government nationalized in 1970.[3] over time grew to number 21 branches.[4]

In the 1950s, SBE established a branch in Djibouti.[5] In 1920 the Bank of Abyssinia opened a transit office in Djibouti. At some point after its creation, the State Bank of Ethiopia reopened the transit office, which in time became a branch.

In 1963, the Ethiopian government split the State Bank of Ethiopia into two banks, the National Bank of Ethiopia (the central bank), and the Commercial Bank of Ethiopia (CBE).[6] Seven years later, the Sudanese government nationalized the Commercial Bank of Ethiopia's branch in Khartoum.[3]

The Ethiopian government merged Addis Bank into the Commercial Bank of Ethiopia in 1980 to make CBE the sole commercial bank in the country. The government had created Addis Bank from the merger of the newly nationalized Addis Ababa Bank, and the Ethiopian operations of the Banco di Roma and Banco di Napoli. Addis Ababa Bank was an affiliate that National and Grindlays Bank had established in 1963 and of which it owned 40%. At the time of nationalization, Addis Ababa Bank had 26 branches. The merger of Addis Ababa Bank with CBE made CBE the sole commercial bank in Ethiopia, with 128 branches and 3,633 employees.[4]

In 1991, when Eritrea achieved its independence, CBE lost its branches in Eritrea to nationalization. These branches formed the base for what became in 1994 the Commercial Bank of Eritrea. Also in 1994, the Ethiopian government reorganized and reestablished CBE.[4]

In 2004, CBE closed its branch in Djibouti due to problems with loan losses.[5]

In January 2009, CBE received regulatory approval to open a branch in Juba, Southern Sudan.[7] CBE expanded its presence in South Sudan to five branches in Juba and Malakal, but ongoing conflict in the country has forced CBE to close all but two branches in Juba.[5]

A few years ago, the government restructured CBE and signed a contract with Royal Bank of Scotland for management consultancy services. After the death of its former President, Mr. Gezahegn Yilma, the Board of Management appointed Mr Abie Sano as a new President of the Bank. Parliament recently increased the Bank's capital to 4 billion Ethiopian Birr.

References

  1. ↑ Commercial Bank of Ethiopia Profile 2014/15
  2. ↑ Electronic-Banking in Ethiopia- Practices, Opportunities and Challenges
  3. 1 2 Mauri, Arnaldo (2008); The re-establishment of the Ethiopia's monetary and banking systems, Dept. of Economics and Business, University of Milan, W.P. n. 11-2008.
  4. 1 2 3 Shin, David H., and Thomas P. Ofcansky (2013) Historical Dictionary of Ethiopia. (Scarecrow Press), pp. 67-9. ISBN 978-0-8108-7194-6
  5. 1 2 3 Addis Fortune,",[http://addisfortune.net/articles/commercial-bank-targets-diaspora-with-foreign-market-expansion/ - accessed 27 March 2015.
  6. ↑ BRIMMER, Andrew F. (1960). "BANKING AND FINANCE IN THE SUDAN". South African Journal of Economics (28): 23–34. doi:10.1111/j.1813-6982.1960.tb01848.x.
  7. ↑ ALEMU, HILINA (18 January 2009). "Ethiopia: CBE Poised for Venture into South Sudan". allAfrica.com. Retrieved 21 January 2013. External link in |newspaper= (help)

External links

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