The National Bank of Ethiopia (NBE) has issued its first license under the recently amended Banking Business Proclamation to a Kenyan-owned financial institution, enabling it to continue operating its representative office in the country.
In a statement released on Thursday, the central bank announced that Standard Bank Group’s representative office in Ethiopia has been officially re-licensed in accordance with the revised proclamation. This new law places the licensing and supervision of foreign banks’ representative offices (REPOs) directly under the NBE’s regulatory authority.
Previously, these offices operated under licenses granted by the Ministry of Trade and Regional Integration. As part of the transition, the NBE has begun the re-licensing process for all existing foreign bank representative offices and is currently reviewing new applications.
Standard Bank, which has had a representative office in Ethiopia for several years, is the first institution to receive formal approval under the new framework.
Representative offices function as commercial and liaison centers for foreign banks, conducting market research, building relationships, and promoting their parent institutions. However, they are not authorized to offer banking services or conduct financial transactions.
The revised Banking Business Proclamation aims to enhance foreign participation in the Ethiopian financial sector through various investment options. Kenya Commercial Bank (KCB), the largest bank in East Africa by assets, has already shown a strong interest in entering the market, with indications that it may acquire a stake in one of the existing domestic banks.
