CBE Logs 7.7 trillion Birr in Digital Transactions Over Eight Months

Ethiopia’s state-owned banking enterprise, Commercial Bank of Ethiopia (CBE), has reported that the value of its digital transactions in the past eight months has soared past 7.7 trillion birr. The figure indicates a 92% increase from the same time last year and is 1.7 trillion birr higher than the value of digital transactions across Ethiopia’s financial sector two years ago. According to the statement issued across the Bank’s online portals today, the volume of digital transactions has also surged to 1.2 billion in the reported period. With nearly 79% of the Bank’s transactions being digital, the volume of transactions also shot up by 84% from the same time last year.

The Bank, which saw its capital base balloon by 105% following a recent injection through bond issuances, also made significant gains in its forex allocation. CBE disbursed around 5.14 billion dollars to facilitate imports, of which 23% flowed to the private sector. The Bank is currently undergoing a systemic overhaul of its working practices as part of broader SOE and financial reforms. CBE is the only bank that qualified as a systemically important bank in the latest stability report by the National Bank of Ethiopia. The categorization stems from the fact that CBE manages nearly half of the industry’s deposits and assets as well as its significance to overall financial stability .

However, the Bank’s dominant position has not come without prices. Nearly 93% of the 900-billion-birr bond issuance in November is slated to go to addressing CBE's non-performing loans. Four months back, the World Bank approved a 700-million-dollar credit line, of which the majority will be flowing to CBE for a four-year financial strengthening project. One of the contributing factors to CBE’s vulnerabilities has been non-performing loans accrued across decades in lending to other state-owned enterprises.