Ethiopia - Financial Sector Capacity Building Project

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The Financial Sector Capacity Building Project for Ethiopia assists in building the foundation for a more transparent, well-governed, well-regulated, and competitive financial sector that allocates resources to the private sector more effectively and efficiently, and helps to ensure better access to finance for all. The project has five components: Component 1 primarily helps strengthen the human and institutional capacity o f the National Bank of Ethiopia so that it can discharge effectively its key functions of regulating and supervising financial intermediaries, undertaking economic research, and formulating and implementing monetary policy. It provides financial and technical assistance (including training and exposure programs) to build capacity in: (1) banking and insurance regulation and supervision and corporate governance of financial institutions; (2) economic research, policy formulation, and implementation functions; (3) internal audit and finance; (4) legal; (5) information technology; (6) human resource management; and (7) bank modernization. Component 2 strengthens financial sector infrastructure by providing financial and technical assistance for: (1) payment system modernization; (2) improving the credit information center; (3) developing the capital markets infrastructure; and (4) setting up an asset/collateral registry to facilitate secured loan transactions. Component 3 develops new financial products that are critical to improving access to finance and fostering financial sector broadening and deepening. It includes housing finance; leasing finance; small and medium enterprise financing; agricultural risk insurance/management; and other products, such as a venture capital fund and credit cards. Component 4 enhances professional skills in the financial sector. It focuses on: (1) developing in-country training capacity, including strengthening of the Ethiopian Institute of Banking and Insurance, to build up the skills of financial sector professionals, including bankers, insurers, leasing experts, mortgage specialists, securities brokers and issuers, accountants and auditors; and (2) building up the capacity of financial sector professional associations. Component 5 supports project related implementation, and monitoring and evaluation activities.