Commercial Bank of Ethiopia Moves to Establish an Investment Bank













The Commercial Bank of Ethiopia (CBE) is in the process of establishing an investment bank, a move aligned with recent regulatory changes aimed at fostering growth in Ethiopia’s financial sector. This initiative is being coordinated with the involvement of Mr. Zemedeneh Ngatu, an experienced investment consultant and managing director of Fairfax Africa Fund.

Regulatory Changes Enable New Opportunities

The establishment of the investment bank follows the repeal of a 2017 directive that restricted commercial banks from participating in various investment sectors. The annulment of this directive on July 23, 2024, and subsequent provisions in the Capital Market Proclamation now permit commercial banks to own full stakes in non-credit institutions such as investment banks. This regulatory shift is part of broader efforts to build a capital market infrastructure in Ethiopia.

Investment Banks and Their Role in the Economy

Investment banks are central to capital markets, offering advisory services to businesses, start-ups, and other organizations seeking to raise funds. They also act as intermediaries in the issuance and sale of shares, facilitate mergers and acquisitions, and provide consulting services. Their revenue comes from fees generated through these services, making them key players in financial ecosystems.

CBE’s initiative to enter the investment banking sector is seen as a significant step, leveraging its position as a state-owned institution to instill confidence in the market.

Coordination with Mr. Zemedeneh Ngatu

The involvement of Mr. Zemedeneh Ngatu in this project reflects CBE’s strategy to tap into his expertise in investment and fund management. As the managing director of Fairfax Africa Fund, Mr. Zemedeneh brings experience in advising and managing investment projects. His role in guiding the establishment of this investment bank underscores the significance of creating a strong foundation for Ethiopia’s capital markets.

Fairfax Africa Fund is a consulting firm specializing in fund management, pooling resources from various parties to invest in profitable ventures. However, its track record in Ethiopia has yet to be widely documented.

Insights from Mr. Zemedeneh’s Career

Mr. Zemedeneh has held various leadership roles in the investment and consulting sectors. Previously associated with Ernst & Young, he parted ways with the international consulting firm following disagreements. He was also involved in the initial stages of establishing Selam Bank, although the venture faced challenges in meeting its capital requirements.

Implications for Ethiopia’s Financial Market

CBE’s move to establish an investment bank is expected to play a pivotal role in shaping Ethiopia’s nascent capital market. By providing advisory services and facilitating access to financing, the investment bank could serve as a catalyst for economic growth. Its presence is likely to attract investors and support businesses seeking to raise capital.



The Commercial Bank of Ethiopia’s initiative marks a significant development in the country’s financial sector. While the success of this venture will depend on its execution and market reception, it represents a key step toward diversifying Ethiopia’s financial landscape and building confidence in its capital markets.