Regulatory Alerts2020-05-15
Added · Updated
Requirements for Relicensing a Microfinance Institution as a Bank
The National Bank of Ethiopia establishes requirements for microfinance institutions seeking to be relicensed as banks, mandating a minimum CAMEL rating of 3, a certified minimum paid-up capital, and a cap on regional government shareholding at 70%. Relicensed banks must maintain microfinance services as a core business, organize a dedicated function for it, and open reserve, payment, and settlement accounts with the National Bank before commencing operations. The directive exempts these institutions from specific pre-application and application provisions of Directive SBB/56/2013 and allows microfinance experience to count as banking experience for executive fit and proper assessments. A comprehensive action plan to comply with all relevant laws and directives must be submitted within 24 months of relicensing.