The House of People’s Representatives has enacted the amendment of Banking Business Proclamation No. 1360/2015 (“The Proclamation”) in March 2025. The Proclamation amends Proclamation No. 1159/2019. This landmark legislation represents a pivotal shift in Ethiopia’s economic landscape, primarily by liberalizing the banking sector to welcome foreign investment. Previously, only Ethiopians and foreign nationals of Ethiopian origin could participate in the banking industry. By opening the banking sector to foreign investment, the Proclamation aims to foster economic development by attracting foreign expertise and capital.
We have provided a legal update on the draft of the Banking Business Proclamation in the second edition of our legal newsletter. The enacted version reflects a change from the draft, specifically regarding the shareholding limit. While the draft stipulated that individuals could directly own up to 5% of a bank’s prescribed shares, this has now been increased to 7%. Apart
from this adjustment, there are no other significant differences between the draft and the final Proclamation.
For detail information please see Volume 2 of our newsletter
