REQUIREMENTS FOR LICENSING AND RENEWAL OF BANKING BUSINESS AND REPRESENTATIVE OFFICE

DIRECTIVE NO. SBB/94/2025

JUNE 2025 nbe.gov.et

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TABLE OF CONTENTS

• PREAMBLE ......................................................................................................................... 3
• PART ONE: GENERAL PROVISIONS .............................................................................. 4
• PART TWO: LICENSING OF A BANK OTHER THAN A FOREIGN BANK BRANCH ........... 11
• PART THREE: LICENSING OF A FOREIGN BANK BRANCH ........................................... 27
• PART FOUR: LICENSING OF A REPRESENTATIVE OFFICE OF A FOREIGN BANK .......... 38
• PART FIVE: MISCELLANEOUS ITEMS ........................................................................... 43

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PREAMBLE

WHEREAS, promoting strong and viable banking sector in Ethiopia is crucial for macro-economic stability and growth;

WHEREAS, proper licensing and supervision of banking business and representative offices of foreign banks is important to ensure safety and soundness of the banking sector;

WHEREAS, it is important to put in place the necessary legal framework for licensing a bank owned by foreign investors, including foreign banks, and for bringing the licensing and supervision of representative office of foreign banks to the National Bank’s regulatory ambit;

WHEREAS, it is necessary to ensure that appropriate and effective coordination mechanisms are established with home supervisory authorities of foreign banks whose banks have been hosted in Ethiopia;

WHEREAS, establishing clear, objective and transparent requirements for licensing and renewal is essential to promote the sector;

NOW, THEREFORE: in accordance with, Articles 3(3), Article 4(1) (a, b, f, and i), Article 4(3 and 5), Article 5 (2), Article 6(1), Article 7, Article 10 (1)(n), Article 10 (2)(a), Article 10 (3)(b, c and f), Article 10 (4), Article 11, Article 13 (3), Article 17(5)(b), Article 82(1) and Article 91(2) of Banking Business Proclamation No. 1360/2025 (hereinafter referred to as the “Proclamation”), the National Bank has issued this Directive.

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PART ONE: GENERAL PROVISIONS

1. Short Title

This Directive may be cited as “Requirements for Licensing and Renewal of Banking Business and Representative Office Directive No. SBB/94/2025.

2. Definitions

For the purpose of this Directive, unless the context requires otherwise:

2.1 “Acceptable Foreign Currency”

means any currency other than Ethiopian legal tender, which is a legal tender in any country outside Ethiopia and shall be limited to United States Dollar, Euro and Pound Sterling.

2.2 “Agent Banking Service”

means the provision of banking service through an agent, under a valid agency agreement, as prescribed in the relevant National Bank Directive.

2.3 “Bank”

means a private or state-owned bank, a foreign bank subsidiary or a branch of a foreign bank licensed by the National Bank to undertake banking business.

2.4 “Banking Business”

means any business that consists of activities as prescribed under Banking Business Proclamation No. 1360/2025.

2.5 “Bank Group”

means both domestic and foreign bank and all of its subsidiaries, branches, affiliates, and holding company, wherever located, that the National Bank determines to be taken into account for the purpose of this Directive.

2.6 “Beneficial Owner”

means any natural person who ultimately owns or controls a customer or an account, the person on whose behalf a transaction is being conducted, or the person who ultimately exercises effective control over a legal person or arrangement.

2.7 “Branch Capital”

means minimum capital that has been permanently assigned by a foreign bank as prescribed by the National Bank, for the purposes of opening a foreign bank branch, and is inwardly remitted to Ethiopia.

2.8 “Branch Management Committee”

means the committee responsible for the local management and oversight of the foreign bank branch(es), and is composed of the senior country officer as chairperson, and other senior executive officers of the foreign bank branch responsible for, at a minimum, credit operations, investment, international banking, branch operations and heads of internal audit, risk management and compliance functions and anti-money laundering and combating financing of terrorism compliance officer.

2.9 “Chief Executive Officer”

means a person, by whatever title that person may be referred to, who is primarily responsible for the day-to-day management of the affairs of a bank.

2.10 “Chief Representative Officer”

means a person who is an employee of a foreign bank, who is resident in Ethiopia and is primarily responsible for the day-to-day management of the affairs of a representative office of the foreign bank.

2.11 “Commercial Code”

means Commercial Code of Ethiopia Proclamation No. 1243/2021.

2.12 “Company”

means a share company as defined under the Commercial Code, and registered under the laws of, and having its head office in Ethiopia.

2.13 “Digital Financial Service”

means provision of banking service including credit, savings, remittances, payments and other related services accessed and delivered through digital channels.

2.14 “Direct Shareholding”

means shareholding in a bank, by a person directly on his own name, or jointly with his spouse or with a person who has not attained the age of legal majority related to him by consanguinity to the first degree or through any other conditions as may be determined by the National Bank.

2.15 “Director”

means any member of the board of directors of a bank, by whatever title he may be referred to.

2.16 “Domestic Bank”

means a bank incorporated under the laws of Ethiopia; and is conducting banking business in Ethiopia.

2.17 “Employee”

means a chief executive officer, a senior executive officer or any other person who is appointed or hired by a bank or assigned through staff transfer to carry out its day-to-day activities.

2.18 “Financial Institution”

means a bank, an insurance company, a reinsurer, a micro finance institution, a micro insurance company, payment instrument issuer, payment system operator, a capital goods finance company, a money transfer institution, representative office of a foreign bank, a postal money transfer institution or such other similar institution as determined and licensed by the National Bank.

2.19 “Fit and Proper Criteria”

means criteria prescribed by the National Bank to assess and determine whether persons with significant influence possess the integrity, financial soundness, competence and capacity to fulfill the responsibilities required of their positions.

2.20 “First Degree of Consanguinity or Affinity”

means spouse, children and parents.

2.21 “Foreign Bank”

means a bank or bank group incorporated under the laws of a country other than Ethiopia with a banking license issued from its home country regulator and conducts its banking business in its country of incorporation or other jurisdictions as the case may be.

2.22 “Foreign Bank Branch”

means deposit or non-deposit taking branch of a foreign bank, having no separate legal existence.

2.23 “Foreign Bank Subsidiary”

means a subsidiary as defined under the Commercial Code, and controlled by a foreign bank strategic investor, and incorporated under the laws of, and having its head office in Ethiopia.

2.24 “Foreign National”

means a person who is not an Ethiopian national and includes foreign banks.

2.25 “Foreign National of Ethiopian Origin”

means a person with valid identification card obtained pursuant to Proclamation No. 270/2002 and other relevant laws issued in line with this Proclamation, attesting that he is foreign national of Ethiopian origin.

2.26 “Foreign Owned Ethiopian Organization”

means an entity that is fully owned by Foreign Nationals or jointly owned with Ethiopians, and registered under the laws of, and having its head office in Ethiopia.

2.27 “Home Supervisor”

means the supervisory authority of a foreign bank that wishes to establish a foreign bank subsidiary or open a foreign bank branch or a representative office of a foreign bank in Ethiopia.

2.28 “Host Supervisor”

means the National Bank of Ethiopia in respect of foreign bank subsidiaries and foreign bank branches operating in Ethiopia and representative offices of foreign banks.

2.29 “Indirect Shareholding”

means shareholding in a bank through an entity owned by a direct shareholder with ten percent or more ownership in the entity or through his children who attained the age of legal majority or through any other conditions as may be determined by the National Bank.

2.30 “Interest Free Bank”

means a bank licensed by the National Bank to engage in interest free banking services.

2.31 “Interest Free Banking Service”

means provision of banking service by a full-fledged interest free bank or interest free banking service window in compliance with Shariah principles, including non-acceptance of interest.

2.32 “National Bank”

means the National Bank of Ethiopia.

2.33 “Parent Bank”

means a domestic bank that fully or partially owns more than fifty percent of the subsidiary operating in Ethiopia.

2.34 “Persons with Significant Influence”

are shareholders with significant ownership, directors, chief executive officer, senior country officer, and senior executive officers of a bank including branch management committee.

2.35 “Proclamation”

means the Banking Business Proclamation No. 1360/2025.

2.36 “Project Manager”

means a person who is in charge of the whole process of obtaining banking business license for a bank and, in the case of a foreign bank subsidiary or foreign bank branch, the person shall also serve as a legal proxy of the bank.

2.37 “Promoters”

means persons who initiate plans and facilitate the formation or generally act with the view of realizing the formation of a domestic bank or foreign bank subsidiary, and who shall be jointly and severally liable for damage sustained in connection with failure to establish the bank, if not formed, to third parties in respect of commitments entered into during the formation process.

2.38 “Qualification of Competency”

means required education, experience, competence, fitness and propriety as determined by the National Bank Directive.

2.39 “Representative Office”

means an office of a foreign bank located in Ethiopia and engaged in representational functions such as liaison, marketing, research and other similar activities as prescribed in this Directive.

2.40 “Senior Country Officer”

means a person who is resident in Ethiopia and is primarily responsible for the day-to-day management of the affairs of a foreign bank branch, as well as, representing the foreign bank as central point of contact with the National Bank and other stakeholders.

2.41 “Senior Executive Officer”

means any officer of a bank by whatever title that officer may be referred to, who:

• 2.41.1 manages two or more departments or directorates under its portfolio or manages one department of critical importance as defined by the National Bank and is directly reporting to the chief executive officer;
• 2.41.2 reports directly to the board of directors;
• 2.41.3 is company secretary;
• 2.41.4 is senior country officer of a foreign bank branch who is responsible to manage the operation of the local branch/es and represent the bank in respect of its business relationship with the National Bank and other stakeholders; and
• 2.41.5 members of the foreign bank branch management committee.

2.42 “Shariah Committee”

is a group of experts of a bank that provides interest-free banking services; having knowledge of the Shariah principles and banking business; and is responsible for ensuring that the bank’s products and services are in compliance with Shariah principles.

2.43 “Significant Ownership”

means direct or indirect shareholding of two percent or more of the total subscribed capital of a bank by a person.

2.44 “Staff Transfer”

means the transfer of foreign national employees from a foreign bank to its branch or subsidiary in Ethiopia, as determined by the National Bank.

2.45 “Strategic Investor”

means a foreign bank or a bank group with in-built good reputation in its country of incorporation or owned by the government of the country where it was incorporated, or international development finance institution, private equity fund or other similar entities to be determined by the National Bank and meet the minimum vetting criteria as set out in this Directive.

2.46 “Subsidiary”

means as defined under the Commercial Code, and controlled by a parent bank, registered under the laws of, and having its head office in Ethiopia.

2.47 “Person”

means any natural or juridical person;

2.48

In this Directive, any expression in the masculine gender includes feminine.

3. Scope of Application

This Directive shall be applicable to those who wish to obtain or renew banking business license or obtain or renew license for representative office of a foreign bank.

4. General Principles

4.1

A person who desires to carry out banking business in Ethiopia or open a representative office shall apply in writing to the National Bank.

4.2

The National Bank’s assessment of a strategic investor, shall, at a minimum, include the following criteria:

• 4.2.1 governance and financial soundness;
• 4.2.2 status of compliance with the requirements of the home regulator;
• 4.2.3 approval by home regulator, including arrangements for cross-border supervision and degree of cooperation by home regulator; and
• 4.2.4 degree of strategic value it brings to the Ethiopian financial system.

4.3

The National Bank’s approach to a new license applicant shall cover the progression of the application through pre-application phase, application phase and commencement of operation phase.

4.4

The National Bank shall carry out the supervision of banking business in line with relevant international standards, as well as local regulatory standards and requirements and may engage in cooperation and exchange of relevant supervisory information with respective home supervisor of a foreign bank, as necessary.

4.5

A foreign bank subsidiary and a foreign bank branch shall comply with all relevant prudential requirements, equally with a domestic bank, as appropriate.

4.6

The National Bank, based on its own assessment and determination, shall have the power to decide on whether or not to grant a license to an applicant.

4.7

The National Bank may issue moratorium on the issuance of business license to new banks as determined necessary.

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PART TWO: LICENSING OF A BANK OTHER THAN A FOREIGN BANK BRANCH

5. Promoters and Project Manager

5.1

Promoters who desire to get a bank license for a domestic bank or foreign bank subsidiary shall appoint a project manager.

5.2

A foreign bank that wishes to establish a fully owned foreign bank subsidiary shall submit a power of attorney authenticated by an appropriate organ authorizing the project manager to act as an agent of the foreign bank.

5.3

The project manager shall have:

• 5.3.1 first degree from recognized higher learning institution; and
• 5.3.2 business experience, preferably in setting up a banking or other financial institutions operation or running a financial institution.

5.4

The project manager and the promoters shall be honest, reputable and diligent. In determining integrity of the promoters and project manager, the National Bank shall consider all relevant factors, including but not limited to:

• 5.4.1 whether the person has a record or evidence of previous conduct and activities where he has been convicted for a criminal offense under any law designed to protect members of the public from dishonesty or fraud whether in Ethiopia or elsewhere;
• 5.4.2 whether the person has a record of withholding information from public authorities, submission of incorrect financial or other statements, prior refusal of regulatory/supervisory approval and failure to comply with requirements of regulatory/supervisory body, other corrective actions or interventions by public authorities;
• 5.4.3 whether the person has an active or current record of disciplinary measures or any dispute with previous employers, or compliance with a code of conduct, which has led to the imposition of a penalty under employment law or any other disciplinary measures imposed by trade or professional associations;
• 5.4.4 whether the person has a record or evidence of conviction of breach of trust, theft, robbery or any other similar criminal offence or failure to discharge his duties and responsibilities, in a duly and sound manner, in his previous role as a promoter of a business organization including a financial institution or in any other circumstance; or
• 5.4.5 promoters shall not be of first degree of consanguinity or affinity relationship among themselves. In the case of legal person promoter, a natural person promoter shall not have 10% or more control in the legal person.

5.5

As part of determining the fitness and propriety of promoters and/or project manager, the following documents shall be submitted to the National Bank:

• 5.5.1 duly completed application form for promoters and/or project manager, as specified under Annex I, of this Directive;
• 5.5.2 properly completed fit and proper test questionnaire for promoters and/or project manager, as specified under Annex II of this Directive;
• 5.5.3 copies of local identification card and national identification card for Ethiopian promoter or project manager; and in the case of a foreign project manager, a copy of valid passport authenticated by a legally recognized body of the issuing country and relevant government organ in the host country.

5.6

Notwithstanding approval requirements stipulated in the Ethiopian Capital Markets Proclamation No. 1248/2021, a promoter intending to raise capital through public offering, shall first meet all fit and proper requirements for promoters as stipulated in this Directive.

6. Licensing Requirements for a Bank Other Than a Foreign Bank Branch

6.1 Pre-application Phase

A person planning to establish a bank shall initiate the process through its promoters or project manager and shall provide the National Bank with adequate information that would allow it to gain an understanding of the applicant’s business plan, its level of readiness and provide any feedback or concerns on the proposed plan. The applicant shall submit the following information and documents to the National Bank:

6.1.1

Signed minutes of first meeting of promoters or in case of a foreign bank, signed minutes of the board of directors and/or other competent authority authenticated by a legally recognized body in the home country, including a resolution approving establishment of a foreign bank subsidiary in Ethiopia.

6.1.2

The National Bank may conduct a pre-application meeting with promoters, project manager (the legal proxy) or any other delegates of a foreign bank as appropriate.

6.1.3

Prior to the pre-application meeting, the promoters and/or project manager shall be required to prepare high-level summary of the business proposition for the bank under formation, to be distributed to prospective investors or other stakeholders and submitted to the National Bank. At a minimum, the aforementioned summary shall contain the following:

• a) a rationale on why the applicant wants to establish the bank;
• b) the initial business plan and strategy for the bank under formation;
• c) an indication of the sources of funding;
• d) proposed governance arrangements for the bank under formation, covering organogram showing key work units/functions, including internal control functions;
• e) evidence validating compliance with relevant regulatory requirements and any other disclaimers;
• f) project plan, including an overview and timeline plan to establish the bank; and
• g) expected risks and impediments in realizing the establishment of the bank and plan to mitigate those risks.

6.1.4

Evidence of registration of trade name of the bank under formation from the pertinent organ of the Federal Government of Ethiopia. In case of a foreign bank, verification and registration of such trade name shall come from Ethiopian Investment Commission.

6.1.5

Written application to the National Bank requesting to open a blocked account, in the name of the bank under formation, with a domestic bank(s) and its specific branch(es). In the case of a license request for a foreign bank subsidiary, the blocked account, which shall be non-interest bearing and denominated in acceptable foreign currency, shall be opened with the National Bank.

6.1.6

Notwithstanding the requirements stipulated under Sub-Articles 6.1.1 to 6.1.5 of this Article and requirements in other relevant laws, the following conditions and information shall be fulfilled in the case of a foreign bank planning to establish a foreign bank subsidiary in Ethiopia:

• a) Details on ownership structure including information on who owns and controls the applicant, the beneficial owners and their percentage shareholding; as well as what level of reliance can be placed on shareholders for access to additional capital, when required.
• b) A statement from its home supervisor, in the form of a written no objection letter, shall be sent directly to the National Bank regarding the proposed establishment of a foreign bank subsidiary in Ethiopia, along with assurance certifying the following in respect of the foreign bank:
  • i. is incorporated or established in accordance with the laws of home country, with a reference to those laws;
  • ii. is licensed as a bank or bank group by an appropriate organ, is operational and the details of the license;
  • iii. is in good financial standing;
  • iv. maintains the home supervisor’s risk management standards;
  • v. meets prudential requirements;
  • vi. meets capital adequacy and liquidity Basel standards currently being applied by the home supervisor;
  • vii. where applicable, is supervised on a consolidated basis;
  • viii. where applicable, the amount, composition and geographical distribution of capital and the sum of the capital requirements for consolidated group; and
  • ix. advice on whether the applying foreign bank has ever had an application to establish a presence in another country rejected or had approval to conduct banking operation in another country suspended or revoked, and the reasons for that action.
• c) Information on the recent rating of the foreign bank, if any, by external credit assessment institutions.
• d) Submission of a copy of the foreign bank’s certificate of incorporation or establishment, authenticated by a legally recognized body in the home country and relevant government organ in the host country, including commercial registration number of the foreign bank planning to establish a foreign bank subsidiary in Ethiopia;
• e) Submission of a copy of the Memorandum and/or Articles of Association of the foreign bank, authenticated by a legally recognized body in the home country and relevant government organ in the host country, by whatever term such documents are referred to in the specific foreign jurisdiction;
• f) Submission of a document showing that it is widely owned and listed in the stock exchange in its country of origin, or wholly owned or majorly controlled by the government of its country of origin wherein it is operational. The National Bank, may, however, consider, on exceptional basis, foreign bank applicants that are not listed in a capital market;
• g) Organizational arrangements, including:
  • i. organogram, showing direct and indirect affiliates and associates, if any;
  • ii. description of the nature of the relationships within the bank group or holding group, where applicable;
  • iii. indication of whether the holding group, if applicable, is operating or not; and
  • iv. where applicable, description of the business and activities of the entities found in the group, including whether the activities are regulated or not.
• h) Submission of annual reports of the foreign bank for the last three (3) years; and
• i) Provision of details of the foreign bank’s banking business activities in other host jurisdictions, if any.

6.1.7

Evidence of payment of non-refundable investigation fees. In the case of a foreign bank, the investigation fee shall be paid in acceptable foreign currency, as per Article 10 of this Directive.

6.2

The National Bank, after ensuring successful completion of the pre-application phase to its satisfaction shall inform the applicant in writing about same and advise to proceed to the application phase.

6.3 Application Phase

A person applying to establish a bank, after undertaking self-assessment with regard to fulfillment of the licensing requirements, shall submit the following documents and information, along with an application letter:

6.3.1

Duly completed application form, as specified under Annex III (for domestic bank) or Annex IV (for foreign bank subsidiary) of this Directive, together with all enclosures as stated herein, to the National Bank.

6.3.2

Evidence of minimum paid-up capital of Birr 5 billion under the following conditions:

• a) for foreign bank subsidiary, the subscribed capital shall be fully paid in cash in acceptable foreign currency;
• b) all issued shares shall be subscribed and, except for a foreign bank subsidiary, at a minimum, one-fourth of the subscribed shares shall be fully paid in cash;
• c) source of funds for the minimum capital shall be disclosed;
• d) a person considered as foreign national of Ethiopian origin as per the relevant law or an enterprise fully owned and established by these individuals and preferred to be treated as domestic investor shall pay its paid-up capital in Ethiopian Birr, however, any proceed generated from this investment shall not be transferred abroad in foreign currency;
• e) a foreign bank strategic investor may be allowed to establish a wholly or partially owned foreign bank subsidiary; and
• f) notwithstanding Sub-Article 6.3.2 (e), applicants shall observe the following shareholding limits:
  • i. a natural person may not directly hold more than seven percent (7%) of a bank’s total subscribed shares;
  • ii. a juridical person may not directly hold more than ten percent (10%) of a bank’s total subscribed shares;
  • iii. a strategic investor, as defined in this Directive, may not directly hold in a new domestic bank more than forty percent (40%) of a bank’s total subscribed shares;
  • iv. aggregate shareholding by foreign nationals and foreign-owned Ethiopian organizations in a bank, other than foreign bank subsidiary, shall be limited to forty-nine percent (49%) of the total subscribed shares of a bank;
  • v. maximum limit on aggregate direct and indirect shareholding by a natural person and juridical person, excluding strategic investor, shall be fifteen (15%) and twenty percent (20%) of a bank’s total subscribed shares, respectively; and
  • vi. maximum limit on aggregate direct and indirect shareholding by a natural person and juridical person together in a bank shall be twenty percent (20%) of the bank’s total subscribed shares.
• g) disclosure of a shareholder on whether an entity in which he has ten percent (10%) or more ownership or any children who attained age of legal majority have shares in the bank.

6.3.3

Memorandum of Association or Unilateral Declaration for the bank under formation, as appropriate, written in both English and Amharic.

6.3.4

Fitness and propriety information, which shall include:

• a) Disclosure of natural person shareholders with significant ownership through submission of copy of local identification card and national identification card for Ethiopian and in the case of foreign nationals, copy of valid passport authenticated by a legally recognized body of the issuing country; address; numbers and value of subscribed capital.
• b) Disclosure of legal person shareholders with significant shareholding.
• c) Where applicable, disclosure of beneficial owners of all shareholders with significant ownership.
• d) Duly completed general information and propriety test questionnaires for shareholders with significant ownership, as per Annex VI and Annex VII, respectively, of this Directive.
• e) Disclosure of personal details through submission of copy of local identification card and national identification card (for Ethiopians) and a copy of valid passport (for foreign nationals), authenticated by an appropriate organ of the issuing country, as well as, curricula vitae, of the proposed directors and chief executive officer.
• f) Duly completed general information, and propriety test questionnaires for the proposed board members and chief executive officer, as per Annex VI and Annex VII of this Directive.
• g) Meeting minutes for appointment of directors and chief executive officer of the domestic bank or a foreign bank subsidiary along with signed minutes and other documents of the appointees in line with the relevant National Bank Directive and other relevant laws;
• h) The following original documents for the proposed board members and chief executive officer shall be submitted, and where country of residence is different from home country, such documents shall come from both countries:
  • i. Criminal clearance certificate by Federal Police or other competent pertinent authority, issued within the last six months; and
  • ii. Tax clearance certificate, issued within the last six months.

6.3.5

Information on the business model, with a level of detail proportionate to the scale and complexity of the proposed banking business and risks associated with same. The information shall include:

• a) Business plan, which shall effectively articulate the business model, viability of operations in the short-term and sustainability in the long-term. The plan shall contain at least the following:
  • i. executive summary;
  • ii. introduction, including rationale for the establishment of a bank and public interest motivation;
  • iii. macroeconomic analysis;
  • iv. financial sector analysis;
  • v. banking sectoral analysis;
  • vi. products and services, as well as, delivery channels, and target markets;
  • vii. business strategy;
  • viii. operational plan;
  • ix. demonstration of the long-term viability of the business proposal, underlining competitive advantages, with supporting documentation and market research;
  • x. capital plan, as well as, liquidity contingency plan and proposed source of funding;
  • xi. business continuity plan;
  • xii. planned information technology systems, which shall be capable of supporting the daily banking operation and producing all required statutory and prudential information in an accurate and timely manner, from the commencement of banking operations;
  • xiii. outsourcing policy and planned outsourcing arrangements involving third-parties and where applicable, within bank group;
  • xiv. accounting policies; and
  • xv. anticipated business and regulatory risks, along with strategies for their monitoring and mitigation.
• b) Organizational structure that shall comprehensively cover business operations of the bank under formation, including:
  • i. key functional areas such as credit operations, finance, retail banking, international banking, information technology, internal audit, risk management and compliance, by whatever name they may be referred to;
  • ii. position titles for chief executive officer, and other senior executive officers, including chief finance officer, and chief internal auditor and chief risk management and compliance officer, by whatever title they may be referred to;
  • iii. direct reporting lines into the board, including board committees, where applicable; and
  • iv. reporting lines for each individual position.
• c) Three (3)-year financial projections, with sufficient level of detail as outlined below and demonstrating that the business model is sustainable and can continue to meet regulatory capital and liquidity requirements:
  • i. balance sheet, income statement, and cash flow, as well as the underlying assumptions;
  • ii. key prudential ratios, such as capital, non-performing loan and liquidity ratios;
  • iii. explanation of the initial and long-term viability of the business model; and
  • iv. stress scenarios to show the effect of key assumptions underpinning the business model.
• d) In addition to the requirements outlined under Sub-Article 6.3.5 (a) to (c) of this Article, the business plan for a proposed foreign bank subsidiary shall also include:
  • i. In case of a foreign bank subsidiary, at least one-third of the total number of board of directors shall consist of individuals having Ethiopian nationality.