WELCOME TO THE NATIONAL BANK OF ETHIOPIA.
As the central bank of Ethiopia, we work to ensure price stability and the safety and soundness of financial institutions.
INTEREST RATE
| Minimun Saving Rate (%) | T-Bill Annual Weighted Average Yield (%) | NBE Policy Rate NBR (%) |
|---|---|---|
Daily Weighted Indicative Rate
ETB per USD
Please note that all rates are updated only on weekdays.
INDICATIVE DAILY EXCHANGE RATE
NATIONAL BANK OF ETHIOPIA ISSUES SECOND FINANCIAL STABILITY REPORT
30 November 2024 | Addis Ababa, Ethiopia
National Bank of Ethiopia (NBE) is hereby issuing Ethiopia’s second Financial Stability Report examining developments and risks in the financial sector and the broader economy during the course of July 2023 – June 2024. The report also addresses the major reforms taking effect in the period July to September 2024 and provides an outlook on issues potentially affecting the stability of Ethiopia’s financial system in the remainder of this year and in 2025.
Banking continued to dominate the broader financial sector, with the former’s total assets accounting for 96.1 percent of the latter’s total assets at the end of June 2024. This implies the Ethiopian financial system’s stability largely depends on the health of its banking sector.
During the reporting period Ethiopia’s banking sector remained stable and resilient. Risks were mostly moderate and stable, although the outlook overall points to increasing risk levels for financial institutions due to external and domestic developments. Nevertheless, the systemic risk level remains limited. Credit risk is lower than the high credit concentration suggests, because loans to the private sector are relatively diversified. In addition, the credit risk stress test shows that even a severe shock would not pose a systemic threat. The banking industry as a whole is also found to exhibit low liquidity risk and shows resilience to short-term liquidity shocks, despite some downside risks. Conversely, operational risks are significant in the banking industry and are expected to rise further in the short and medium term, with incidents of fraud, social engineering, insider threats, and third-party risks on the rise. With respect to market and foreign exchange risks, except for a few affected financial institutions, the banking sector has also performed well during its adjustment to the exchange rate reform in July 2024.
NBE directives have been issued in 2024 to reduce observed risks and to improve the resilience of banks to shocks in several areas. Beyond the system-wide risks, directives put in place recently by NBE have sought to prevent and contain risks in key areas. These include governance, asset classification, lending to individuals with significant influence, large exposures, and related party lending. NBE also continues to work with individual banks that are more exposed to these challenges and struggle to cope with bank-specific risks.
Noteworthy reforms to further strengthen the stability of the financial sector have also been implemented during the year. They include the transition to an interest-rate based monetary policy regime involving the use of Open Market Operations (OMOs), the liberalization of the exchange rate regime, the reform of the Commercial Bank of Ethiopia through restructuring and recapitalization, and the further development of the digital payments ecosystem. In addition, there were reforms to develop the capital market ecosystem as well as legal and regulatory reforms to align banking practices with international best practices. With major fiscal, monetary, and exchange rate reforms put in place in recent months, there is a broadly positive macroeconomic outlook for 2024 – 2025.
The microfinance, capital goods leasing, and insurance business sectors have been analyzed and found to be sound overall, while outlook in these sectors remains positive in terms of growth, stability and resilience.
NBE publishes the financial stability report annually, in November of each year.
FOREIGN EXCHANGE DIRECTIVE NO. FXD/01/2024
News & Events
What is the National Bank of Ethiopia?
We are Ethiopia’s Central Bank.
Learn more about what we do and how we do it.
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Frequently Asked
We are Ethiopia’s central bank. We are a public body and our mission is to maintain monetary and financial stability in Ethiopia.
That work includes making sure prices are stable, banking services are safe, and Ethiopia’s financial system is sound.
NBE, as a central bank, does provide loan to the government and banks, not to individuals and business entities.
We provide a range of free education materials about our notes and their security features. These include leaflets and posters that can be downloaded or ordered online, as well as short films and online training.
We set rules for how banks should be run financially. These rules ensure banks have enough capital (money or other wealth such as property or shares) and the right plans and structures in place.
We monitor banks to ensure they follow our policy. We do this by keeping in contact with bank staff at all levels so we can keep an eye on things like their accounts and the way they work. We call this work ‘supervision’.
If a bank does get into difficulty, we work with it to ensure that firms have orderly wind-down plans in place.
Using regulation and supervision, we try to make sure that banks are run properly, and that if a bank fails it doesn’t cause widespread problems in the economy.
SWIFT is a secured telecommunication system serving members and the financial community. The word SWIFT represents Society for Worldwide Inter-bank Financial Telecommunication. It is a reliable and less costly method to transfer money. All banks in Ethiopia use the system to effect monetary transaction.
All eligible individuals can get foreign currency from commercial banks for these and other purposes.