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Commercial Bank of Ethiopia

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Year of Establishment 

1943

Current Operational Area (s)

Commercial Bank of Ethiopia (CBB) operates almost all over the country. some of the areas are: 

• Tigray

• Amhara

• Oromiyaa

• Southern Nations and Nationalities Peoples’ Regional State (SNNPR)

• Afar

• Addis Ababa

Future Expansion Plan

The CBB wants to increase its outreach through out the country.

Total Number of Branches Opened so far

CBB has 172 branches operating allover Ethiopia.

1. Short-term Loan

Maximum Loan Term:  This is a loan to be settled within one year

Purpose of Loan:  for working capital requirement of people engaged in any type of business sector

RE-payment schedule: Based on the nature of their businesses, borrowers can amortize the loan on monthly, quarterly, bi-annually or at the end of the year.

Type of collateral: Building, vehicle, machine and equipment,

2. Single merchandise Loan

Maximum Loan Term:  90 days

Repayment Schedule:  the loan should be paid back fully in three installments within the 90 days.    

Purpose of Loan:  for locally produced and imported merchandizes

Type of collateral:  Calculated percentage of the merchandize

Loan Criteria:

• written application for the loan;

• renewed trade/business licensee;

• for imported merchandizes, declaration of the custom’s office for the amount of the merchandize to be held as collateral;  

• the merchandize presented for collateral should be durable (not easily perishable) and easy to count and  stock;

• the merchandize should be kept within a warehouse that meets the standard of the CBB. If it is borrower’s warehouse, he/she should produce evidence of ownership and if rented, rental agreement concluded with the owner should be presented to the Bank;

• the borrower shall purchase insurance coverage for the full value of the merchandize in his/her name as well as the Bank;

• the borrower pays any expense that the Bank may incur in keeping the merchandise from damage.    

3. Revolving Merchandise Loan

Maximum Loan Term:  usually not more than 6 months

Repayment Schedule:  the loan should be paid back within the six month-period and ask two-month ahead for another renewal before the six-month period is finished. 

Purpose of Loan:     for locally produced and imported merchandizes

Type of collateral:  Calculated percentage of the merchandize

Loan Criteria: 

All criteria stated under (2) with the following additions

• Merchandise held as collateral must be taken out of the warehouse on a ‘first-in-first out’ order;

• Merchandise held as collateral must fully taken out of the warehouse within 90 days.

4. Project Finance

This type of loan is provided for investment on new projects as well as upgrading of existing projects. 

Loan Term:     

• for medium-term loan , 2 to 5 years;

• for long-term  loan, 5 to 7 years.

Repayment Schedule:  it depends on the nature of the project. It is possible to amortize the loan monthly, quarterly, bi-annually and yearly basis. The Bank gives grace period based on the nature of the project.  

Purpose of Loan: This loan is provided for projects related to industry, hotel and tourism, transport, agriculture as well as to meet their working capital requirements. Loan is also provided for investments required to upgrade privatized enterprises.

 Loan Criteria:

(i) For new projects    

• Project feasibility study;

• Lease agreement and license (only for

• construction of buildings);

• Work permit from concerned government offices;

• Land ownership certificate (for building);

• Memorandum and articles of association (for organizations);

• Pro forma (list of prices) collected within a period of not more than two months; 

• Project equity contribution;

• Bill of quantity and specification (for building);

• Curriculum vitae of project administrators.

(ii).  For expansion/upgrading of existing projects:

• Project study;

• Financial statements (audited by external auditors);

• List of fixed assets with their book value and current market price;

• list of fixed assets to be purchased with their current market value;

• Projected financial statements.

5. Agricultural Loan

Agricultural Loan is provided to individuals, enterprises and associations on a short and medium-term basis.

Loan Term:  

• Short-term loan is for a period of one year;

• Medium-term loan is for a period of 2 to 5 years. 

Repayment Schedule:  Based on the nature of the business, it is possible to repay loans on monthly, quarterly, semi-annually and yearly based. 

Purpose of Loan:  The loan is to be used as working and investment capital in the agriculture sector. 

Grace Period:   Grace period is provided based on the nature of the

agricultural activity loan is requested for.

Loan Criteria:  

• Certificate of land holding/ownership;

• Investment license;

• Project study;

• Equity contribution.

6. Other Types of Loans

• Letter of Credit

• Advance on export bills

• Overdraft loan

• Foreign bank Guarantee

Time needed to process get loans, 
annual interest rate, service charge and other fees

General Conditions for all loan types

Collateral:

• Building: residential houses, buildings of associations/organizations and warehouses, building under construction, privatized building and houses, etc.

• Vehicles of different types;

• Bank guarantee: local bank guarantee, Foreign bank guarantee

• Unconditional Insurance guarantee;

• Money in bank account: savings account, current account, time deposit.

• Merchandise pledge;

• Treasury bills;

• Government bond. 

Who is eligible?

Any person or enterprise engaged in the following sectors is eligible for the services:

• domestic trade;

• foreign trade;

• factories;

• services;

• transport;

• mining;

• construction;

• agriculture;

• hotel and tourism;

General criteria for all loans

• Written document on purpose and amount of loan;

• Renewed trade/business license as well as other relevant licenses;

• Memorandum and Articles of Association (for legally registered enterprises);

• Financial statements: Balance sheet, income statement and cash flow statement;

• Annual business plan;

• Management profile;

• Certificate of ownership for properties pledged as collateral;

• Insurance for the collateral;

• Opening of saving account at the branch where the loan is allowed;

Some of the economic activities financed so far

• Agriculture;

• Manufacturing and industry;

• Domestic trade; 

• Hotel and tourism;

• Foreign trade (import and export);

• Construction and

• Services.

Basic Contents of Business plan to be presented for all loan types

• Name and address of the borrower;

• Purchase plan;

• Production plan;

• Projected income statement;

• Projected balance sheet

• Projected cash flow statement.

Contents of Application Form

• Name and address of the borrower and the business;

• Year of establishment of the business;

• Type of business;

• Type of credit request;

• Collateral offered;

• Owners (major shareholders)

• Others.

Financing Micro and Small Enterprise Sector Operators

The CBE is studying the possibility of financing Micro and Small Enterprise operators. 

Plan to avail loan fund to Micro Finance Institutions (MFIs)

CBE has a plan to finance MFIs.  

(c)  Savings Products

(d)  Other Services

• Money transfer;

• Foreign currency exchange

Service Out-let

The services of the Bank are accessible through its branch offices.

Frequency of revising loan policies

The Bank re-visits its policies and make amendments whenever necessary. 

Address

P.O.Box :  255, Addis Ababa, Ethiopia

Telephone :  +251-1-515004 or +251-1-515000

Fax :  +251-1-514522

E-mail : cbemrk@telecom.net.et

Web site Address :  www.combanketh.com

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