2merkato

The Commercial Bank of Ethiopia and the Construction and Business Bank, both state managed institutions, have reached an agreement to establish an integrated card payment system that will allow customers to withdraw money from common Automated Teller Machines.

The Commercial bank currently operates 58 ATMs and is waiting on delivery of 400 more it ordered a month ago. The construction bank is also expecting delivery of 20 ATMs ordered at the same time allowing the two banks to have almost 500 ATMs between them.

The Memorandum of Understanding establishing the arrangement signed earlier this month requires the CBB to pay fees to the commercial bank for the use of its technology.

Major Ethiopian banks decided to raise their paid up capital to meet the directive by the central bank. The banks could offer up to 2.3 million shares worth 2.7 billion birr in total.

Nine of the 14 banks operating at the present expect to meet the target sum of 500 million birr by contributing their dividends as well as offering equity on the market.

Awash, Dashen, NIB, United and Wegagen banks have already met the requirements with Wegagen topping the list with 779.3 million Br in paid-up capital.

USAID signed an agreement with Ethiopian private banks this week that will allow the banks to extend more credit to agriculture and health projects.

The agreement allows for loans up to 20.7 million US dollar for agro processing industries, health enterprises outside of Addis Ababa, small scale farmers and farmers co-operatives.

The three banks that signed the accord with USAID are Zemen, NIB and Abyssinia.

A letter urging Ethiopian private banks to purchase new Treasury bills was sent out by the National Bank. The new bills will be charged to the banks’ Payment and Settlement Accounts (PSAs) at the NBE.

An agreement in regards to the purchase of the new bills was made between the Ethiopian Bankers Association and National Bank officials stated Yohannes Ayalew, Chief Economist and Vice Governor of Monetary Stability at the NBE, in his letter to the banks.

Private Banks will purchase T-bills to the value of the money in their PSAs, which approximates 3% of their total deposit according to the agreement mentioned in the letter.

International Finance Cooperation (IFC), member of the World Bank Group, disclosed it will loan 90 million Euros to Afriflora Group, a large-scale rose grower and distributor based in Ethiopia.

According to the statement issued, IFC said the funding for Afriflora is targeted to increase production by 60 percent, install water recycling systems and increase employment up to 50 percent.

The assistance is significant for Ethiopia’s horticulture sector by enhancing export capacity and increase employment opportunity, said German Vegarra, IFC Head of manufacturing, agribusiness and services in Africa.

Afriflora Group, which is founded in 2004, is a manufacturer and marketer of cut-rose products with a large scale production farm based in Ethiopia. The company’s main growing facility is situated in Ziway, Ethiopia. It is one of the largest single rose growing facilities in the world.

Source: Ethiopian News Agency