In a statement issued Sunday, the NBE said the measure is part of its broader efforts to reinforce financial integrity and ensure the fair operation of the recently introduced foreign exchange market.
The central bank said the suspension was necessitated by the banks’ use of under-invoiced customs exchange rates.
“This practice not only distorted the market but also allowed these banks to gain unfair advantages by selectively selling foreign currency to their connections, undermining the principles of fair competition,” it said.
It said further investigations revealed that these banks were profiting illegally by adding an extra margin of 20 Ethiopian Birr per dollar on both the buying and selling sides of transactions.
According to the statement, in some cases, they imposed additional conditions, such as requiring customers to have a profit of at least 1 million Birr in their accounts, maintained consistently over the past four months, to be eligible to purchase dollars. ’This exclusionary practice effectively barred many customers from accessing foreign exchange, further exacerbating the inequities in the market,” the bank said.
Noting that it is crucial for maintaining financial stability and ensuring that the newly implemented exchange rate system functions effectively, the bank said NBE’s monitoring system plays a vital role in identifying and addressing such malpractices.
MG/abj/APA