 |
Ethiopia's Biggest Bank to Hand Over Management to Foreign Bank
The Commercial Bank of Ethiopia (CBE), the biggest and a publicly-owned bank in the country, will hand over its management to a foreign bank for the first time in its history of more than half a century.
A preliminary contract has reportedly been signed between the CBE and the State Bank of India and a final agreement is expected to be reached in a few months.
Ato Tilahun Abay, president of the CBE, was quoted by the Walta Information Center on Monday as saying that the State Bank of India has been selected out of the 12 international banks who have submitted bids for the management of the CBE.
As stipulated in the preliminary agreement, the State Bank of India will manage the CBE for a three-year period, against a fee of 2.5 million U.S. dollars. The starting date is expected to be set in September 2001.
Tilahun said the contract management is being instituted out of the need to modernize the CBE's operations, build the capacity of staff and interconnect its branches through computer network.
However, the president said the modernization program will not lead to layoffs and closure of some of CBE branches.
Meanwhile, the weekly Fortune newspaper said that although the State Bank of India's main mission is said to make the CBE internationally competitive, train the local workforce to ultimately take over the management of the bank and maintain the set standard, it has also been given the task of introducing radical changes in areas of information technology, human resource development, enhancement of credit portfolio, branch network management, reducing non-performing loans and increasing credit facility.
The State Bank of India is a huge bank with 200,000 employees and assets valued at 56 billion dollars.
In This Section
|