Banks that are under-formation must hold general assembly and submit their final application within six months if they wish to start operation with an initial paid-up capital of half a billion Birr, according to the National Bank of Ethiopia (NBE).
Banks that are in the process of collecting shares would benefit from the seven year transitory period set by the NBE if they only manage to hold general assembly within six months and make their final application during the same period.
Any bank which failed to comply with the new rule must collect five billion Birr paid-up capital to get a license from the Central Bank. This also applies for microfinance institutions which are in the process of transforming into a bank.
NBE's new directive gives five years to the existing private banks to increase their paid-up capital to five billion Birr within five years, while seven year is given for banks that are under-formation and waiting for a license from NBE.