Among the major developments is the emergence of a capital market, which promises to reshape the country’s financial landscape and potentially redefine the role of commercial banks. The emergence of a capital market poses both challenges and opportunities for Ethiopia’s commercial banks. As investors seek higher returns through capital market investments, commercial banks may experience a reduction in deposit inflows and loan demand. These institutions are well-positioned to capitalize on the growing demand for capital market services, potentially eroding the market share of commercial banks. Ethiopia’s capital market authorities must develop stringent oversight mechanisms to prevent market manipulation, insider trading, and other unethical practices.

Source: Ethiopian News July 18, 2024 13:05 UTC