Banks suspend lending pending clarification from central bank
The National Bank of Ethiopia asked all commercial banks to temporarily suspend providing loans backed by collateral, such as land and buildings.
The NBE’s directive follows findings that the money is being used on the black market, State Minister for Finance, Eyob Tekalign, said on Shefer FM radio on Thursday. The security authorities and the central bank are taking action as part of measures to address the issue, he said.
It wasn’t immediately clear if the order, effective Aug. 11, affects corporate, personal or other loan categories. The banks have suspended all lending pending clarification from the NBE, according to people with knowledge of the matter who asked not to be identified because of its sensitivity.
