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4. MONETARY DEVELOPMENTS
4.1. Money Supply and Credit
Broad money supply (M2) reached Birr 225.6
billion at the end of the third quarter of the
fiscal year 2012/13, revealing quarterly and
annual growth rates of 9.4 percent and 31.5
percent, respectively. The annual growth rate
was mainly attributed to the increase in
domestic credit while the quarterly growth was
caused by the rise in net foreign asset and
domestic credit by 18.2 and 9.1 percent,
respectively.
On annual basis, domestic credit expanded by
26.2 percent due to 30.8 percent increase in
credit to the non-central government, which
offset the 18.4 percent fall in net credit to
central government sector. Similarly, net
foreign assets increased by 2.6 percent on
annual and 18.2 percent quarterly basis, and
reached nearly Birr 47.0 billion at the end of
the third quarter. (Table 4.1)
Table 4.1: Factors Influencing Broad Money ( In Millions of Birr)
2012/13
Qtr. III Qtr. II Qtr. III(Mar. 12) (Dec. 12) (Mar. 13)
A B C1. External Assets (net) 45,771.8 39,754.6 46,981.5 2.6 18.2 2.2 37.42. Domestic Credit 170,731.8 197,503.1 215,542.1 26.2 9.1 82.9 93.4 . Claims on Central Gov't (net) 15,673.9 12,067.1 12,792.2 -18.4 6.0 -5.3 3.8 . Claims on Non-Central Gov't 155,057.9 185,435.9 202,749.9 30.8 9.3 88.2 89.6 . Financial Institutions 11,870.0 13,307.0 14,807.0 24.7 11.3 5.4 7.8 . Others 143,187.9 172,128.9 187,942.9 31.3 9.2 82.8 81.83. Other Items (net) 44,999.4 30,992.2 36,935.8 -17.9 19.2 -14.9 30.84. Broad Money (M2) 171,504.3 206,265.4 225,587.9 31.5 9.4 100.0 100.0
Contributions ofeach componentto broad boney
growth
C/A C/B
2011/12
Particulars
Percentage Change
Annual Quarterly
Source: Staff computation, NBE
Source: Staff computation, NBE
Source: Staff computation, NBE
The third quarter of the fiscal year 2012/13
also witnessed an annual and quarterly rise
in all components of broad money.
Accordingly, narrow money that comprises
currency outside banks and net demand
deposits grew by 31.0 percent on annual
and 11.1 percent quarterly terms. On the
other hand, quasi-money that embraces both
saving and time deposits depicted an annual
and quarterly increment of 32.0 and 7.7
percent, respectively. Hence, year-on-year
basis, both narrow money and quasi-money
contributed 48.8 and 51.2 percent share to
the annual broad money growth rate (Table
4.2).
The annual and quarterly rise in currency
outside banks reflects the continuous rise in
income and public preference to hold cash.
Similarly, the surge in quasi-money
indicates the successful efforts of both
public and private banks in expanding their
branch network to augment deposit
mobilization and improve service outreach.
Table 4.2: Components of Broad Money
2012/13
Qtr. III Qtr. II Qtr. III(Mar. 12) (Dec. 12) (Mar. 13)
A B C
1. Narrow Money Supply 84,974.1 100,201.7 111,345.7 31.0 11.1 48.8 57.7 . Currency outside banks 37,727.7 42,677.0 45,142.4 19.7 5.8 13.7 12.8 . Demand Deposits (net) 47,246.4 57,524.7 66,203.3 40.1 15.1 35.1 44.92. Quasi-Money 86,530.1 106,063.7 114,242.2 32.0 7.7 51.2 42.3 . Saving Deposits 76,393.8 93,133.7 100,726.5 31.9 8.2 45.0 39.3 . Time Deposits 10,136.4 12,930.1 13,515.7 33.3 4.5 6.2 3.03. Broad Money Supply 171,504.3 206,265.4 225,587.9 31.5 9.4 100.0 100.0
2011/12Contributions ofeach componentto broad money
growth
(In Millions of Birr)
Particulars
Percentage Change
Annual QuarterlyC/BC/A
Source: Staff Computation, NBE
Source: Staff computation, NBE
4.2. Developments in Reserve Money and Monetary Ratio
Reserve money reached Birr 70.8 billion at
the end of the third quarter of the fiscal year
2012/13, depicting an annual growth of 13.2
percent albeit a quarterly fall of 5.6 percent.
Excess reserves of commercial banks,
however, decreased significantly (298.8
percent) on annual basis but, recorded a
181.9 percent quarterly surge mainly due to
their increased participation in weekly T-
bills market, presumably in association with
the reduction of the reserve requirement
from 10 to 5 percent as of March 1st, 2013.
The money multiplier measured by the ratio
of broad money to reserve money, grew by
16.2 percent on annual basis implying the
growing monetization of the economy.
Similarly, the ratio of narrow money to
reserve money increased by 15.7 percent
mainly due to surge in demand deposit by
40.1 percent on annual basis.
Regarding other monetary ratios, narrow-
money to broad money ratio decreased by
0.38 percent on annual basis while quasi
money to broad money ratio increased by
0.37 percent (Table 4.3).
Table 4.3: Monetary Aggregates and Ratios
2012/13Qtr. III Qtr. II Qtr. III
(Mar. 12) (Dec. 12) (Mar. 13)Particulars A B C C/A C/B
1. Reserve Requirement (CB's) 16,897.23 20,293.62 10,887.12 -35.57 -46.352. Actual Reserve (CB's) 10,669.49 24,685.06 23,267.02 118.07 -5.743. Excess Reserve (CB's)* -6,227.74 4,391.44 12,379.90 -298.79 181.914. Reserve Money 62,580.80 75,066.38 70,843.96 13.20 -5.62 . Currency in Circulation 44,710.64 50,971.94 54,292.91 21.43 6.52 . Banks deposits at NBE** 17,870.17 24,094.44 16,551.06 -7.38 -31.315. Money Multiplier (Ratio): . Narrow Money to Reserve Money 1.36 1.33 1.57 15.75 17.74 . Broad Money to Reserve Money 2.74 2.75 3.18 16.19 15.896. Other Monetary Ratios (%): . Currency to Narrow Money 52.62 50.87 48.76 -7.33 -4.15 . Currency to Broad Money 26.07 24.71 24.07 -7.68 -2.61 . Narrow Money to Broad Money 49.55 48.58 49.36 -0.38 1.60 . Quasi Money to Broad Money 50.45 51.42 50.64 0.37 -1.51
Percentage Change
(In millions of Birr unless otherwise indicated)
2011/12
Source: NBE and Commercial Banks.
* The data is obtained from commercial banks balance sheet.
** The data is obtained from NBE balance sheet.
Third Quarter 2012/1332
Source: Staff computation, NBE
Third Quarter 2012/1333
-10,000.0
-5,000.0
0.0
5,000.0
10,000.0
15,000.0
20,000.0
25,000.0
30,000.0
2005/06Q1Q2Q3Q4
2006/07Q1Q2Q3Q4
2007/08Q1Q2Q3Q4
2008/09Q1Q2Q3Q4
2009/10Q1Q2Q3Q4
2010/11Q1Q2Q3Q4
2011/12Q1Q2Q3Q4
2012/13Q1Q2Q3
In m
illio
ns o
f Bi
rr
Fig IV.5: Monetary Aggregates(Third Quarter of 2012/13)
RequiredReserve
ActualReserve
ExcessReserve
Source: staff computation, NBE
4.3. Interest Rate Developments [
Average savings deposit and lending rates
remained at 5.4 and 11.88 percent,
respectively, both on quarterly and annual
basis. Weighted average time deposit rate,
however, registered annual increment of
0.18 percentage point. The weighted
average yield on T-bills also went up from
0.8 percent to 1.3 percent on yearly terms.
Considering annual headline inflation of 7.6
percent during the quarter under review,
average lending rate was positive while
deposit rates and T-bill yields remained
negative in real terms. (Table 4.4)
34Third Quarter 2012/13
Table 4.4: Interest Rate Structure of Commercial Banks (Percent per annum)
Particulars
2011/12 2012/13 Percentage Changes
QIII QII QIII Annual Quarterly
1. Savings Deposit Rate
Minimum 5 5 5 0.0 0.0
Maximum 5.75 5.75 5.75 0.0 0.0
Average Saving Rate 5.4 5.4 5.4 0.0 0.0
2. Time Deposits
Up to 1yr 5.61 5.82 5.79 3.16 -0.55
1-2 years 5.71 5.92 5.90 3.28 -0.31
Over 2 yrs 5.76 5.96 5.95 3.35 -0.17
Average Time Dep. Rate (Weighted) 5.70 5.90 5.88 3.26 -0.34
3. Demand Deposit (Weighted) 0.03 0.03 0.03 -8.08 -6.56
4. Lending Rate
Minimum 7.5 7.5 7.5 0.0 0.0
Maximum 16.25 16.25 16.25 0.0 0.0
Average Lending Rate 11.88 11.88 11.88 0.0 0.0
5. T-bills Rate (Weighted) 0.87 1.353 1.333 53.2 -1.5
6. Bond Yield (Simple Average) 4 4 4 0.0 0.0
7. Headline Inflation 32.8 14.9 7.6 -76.7 -48.78
8. Food Inflation 41.1 15.2 5.2 -87.23 -65.5
9. Core/non-food Inflation 22.2 14.6 10.5 -52.9 -28.2
Source: NBE and commercial banks
35Third Quarter 2012/13
Source: NBE and Commercial Banks
Source: Staff computation, NBE
36Third Quarter 2012/13
4.4. Developments in the Financial Sector
Banks, insurance companies and
microfinance institutions are the main
financial institutions in Ethiopia. The
number of banks operating in the country
reached 19 as at the end of March 2013 of
which 16 banks are privately owned.
During the review quarter, 101 new bank
branches were opened, raising the total
number of bank branches to 1,616 of which
791 or 48.9 percent were private owned. As
a result, the ratio of bank branches to total
population went down to 53,155.9 from
56,699.7 in the preceding quarter, reflecting
a significant improvement in financial
service outreach.
About 33.5 percent of the total bank
branches were located in Addis Ababa.
Meanwhile, the total capital of the banking
system reached Birr 20.96 billion at the end
of the third quarter of the fiscal year
2012/13, of which 49.4 percent was held by
private banks. Commercial Bank of
Ethiopia, the biggest state owned bank,
accounted for 36.2 percent of the total
capital of the banking system. The
remaining balance (14.4 percent) belongs to
the two public banks namely, Development
Bank of Ethiopia and Construction and
Business Bank of Ethiopia. (Table 4.5)
The total number of insurance companies
operating in the country reached 16 of
which 15 were privately owned. Their
branches also rose to 264 from 232 a year
ago. Of the total branches, about 53.8
percent are located in Addis Ababa.
During the review quarter, the total capital
of the insurance industry increased by 28.6
percent to Birr 1.37 billion of which the
share of private insurance companies was
73.2 percent.(Table 4.6)
On the other hand, there are 31 micro-
finance institutions (MFIs) operating in the
country. These MFIs have mobilized
savings deposit to the fine of Birr 6.9
billion, which is 41.0 percent higher than
last year same period. Similarly,
outstanding credit of the MFIs scaled up by
43.3 percent on annual basis and reached
Birr 10.8 billion. Their total assets also
increased by 37.2 percent to Birr 16.5
billion by the end of March 2013 (Table
4.7).
Given their intended purpose, MFIs in the
country are contributing to poverty
reduction by providing loans to and
mobilizing savings from the low-income
segments of the population.
37Third Quarter 2012/13
The top five largest MFIs (Amhara,
Dedebit, Oromia, Omo and Addis Credit
and Savings institutions accounted for 85.1
percent of the total capital, 93.2 percent of
the savings, 89.7 percent of the credit and
89.8 percent of the total assets of the
industry.
Capital2011/12
395 103 498 42.2 543 132 675 44.6 560 133 693 42.9 6,231.0 7,586.0 7,586.248 29 77 6.5 57 34 91 6.0 62 38 100 6.2 364.0 479.0 464.831 1 32 2.7 31 1 32 2.1 31 1 32 2.0 2,454.0 2,556.0 2,556.0
474 133 607 51.4 631 167 798 52.7 653 172 825 51.1 9049 10621 10,607.0
37 44 81 6.9 41 55 96 6.3 46 62 108 6.7 1,254.0 1,443.0 1,457.136 37 73 6.2 45 47 92 6.1 50 52 102 6.3 1,157.0 1,353.0 1,353.129 32 61 5.2 35 32 67 4.4 38 42 80 5.0 687.0 839.0 842.733 27 60 5.1 34 33 67 4.4 35 36 71 4.4 1,267.0 1,478.0 1,488.726 36 62 5.2 30 40 70 4.6 30 41 71 4.4 785.0 876.0 878.519 34 53 4.5 25 40 65 4.3 27 40 67 4.1 1,241.0 1,361.0 1,380.344 6 50 4.2 51 8 59 3.9 55 8 63 3.9 287.0 420.0 479.117 13 30 2.5 23 20 43 2.8 23 21 44 2.7 341.0 396.0 401.728 11 39 3.3 34 15 49 3.2 39 18 57 3.5 374.0 456.0 464.5
2 4 6 0.5 3 4 7 0.5 3 5 8 0.5 290.0 206.0 399.811 10 21 1.8 17 12 29 1.9 17 12 29 1.8 236.0 290.0 317.9
6 8 14 1.2 10 9 19 1.3 11 11 22 1.4 170.0 247.0 292.418 2 20 1.7 35 9 44 2.9 36 9 45 2.8 204.0 265.0 285.3
1 3 4 0.3 2 6 8 0.5 2 7 9 0.6 137.0 170.0 190.10 0 0 0.0 2 0 2 0.1 10 3 13 0.8 0.0 124.0 125.3
Enat Bank S.C 0 2 2307 267 574 48.6 387 330 717 47.3 422 369 791 48.9 8,430.0 9,924.0 10,356.5781 400 1181 100.0 1018 497 1515 100.0 1075 541 1616 100.0 17,479.0 20,545.0 20,963.5
QuarterIIIA.A Total
Wegagen Bank
2012/132012/132011/12
Commercial Bank of EthiopiaConstruction & Business BankDevelopment Bank of Ethiopia
Reg. A.A TotalReg.Banks
Branch Network
Total%
Share
Addis Interational Bank
United BankNib International BankCooperative Bank of Oromiya
Zemen BankBuna International Bank
Dashen BankAbyssinia Bank
2. Private BanksAwash International Bank
Reg A.A
Total Public Banks
Lion International BankOromia International Bank
Berhan International BankAbay Bank
3.Grand Total BanksTotal Private Banks
Debub Global Bank
Table 4.5: Capital and Branch Network of Banking System at End of March 31,2013
%Share
1. Public Banks
QuarterIII
QuarterII
Quarter IIIQuarter IIQuarter III
(Branch in Number and Capital in Millions of Birr)
%Share
Source: Bank Supervision Directorate, NBE
Reg. Stands for Region
National Bank of Ethiopia
38Third Quarter 2012/13
Source: staff computations, NBE
QuarterIII
QuarterII
QuarterIII
S.No. A.A Reg Total A.A Reg Total A.A Reg Total 2011/12 2012/13 2012/131 11 32 43 11 35 46 11 37 48 292.2 350.6 368.32 19 11 30 20 12 32 20 12 32 103.7 121.2 117.53 6 7 13 6 7 13 6 7 13 87.6 98.9 103.3
4 9 8 17 9 9 18 9 10 19 46.1 37.0 45.75 15 8 23 16 8 24 16 8 24 89.1 126.4 135.16 6 4 10 6 4 10 6 4 10 27.9 31.7 36.17 11 10 21 11 10 21 11 11 22 121.3 132.5 151.08 9 8 17 12 8 20 12 9 21 103.6 132.5 139.89 14 8 22 14 8 22 15 8 23 99.7 77.2 126.3
10 6 5 11 9 5 14 10 5 15 30.4 41.1 48.111 0 0 0 2 0 2 3 0 3 5.3 23.9 15.612 10 8 18 11 8 19 11 8 19 29.5 51.8 55.413 1 2 3 1 2 3 1 2 3 10.0 10.3 12.714 Berhan insurance S.C 4 0 4 6 0 6 6 1 7 11.0 11.2 6.815 - - - 5 0 5 5 0 5 11.4 10.4 4.116 - - - - - - 0 0 0 - - 8.7
121 111 232 139 116 255 142 122 264 1,068.7 1256.7 1,374.5Source: Insurance Supervision Directorate, NBE
Table 4.6: Branch Network & Capital of Insurance Companies at End of March 31,2013 (Branch in number and Capital in Millions of Birr)
Insurance Companies
Branch
Lion Insurance Company
Capital
Quarter III 2012/13
Ethiopian Insurance CorporationAwash Insurance CompanyAfrica Insurance Company
National Insurance Corporation of Ethiopia
Quarter III2011/12
Quarter II2012/13
Ethio-Life Insurance CompanyOromia Insurance CompanyAbay Insurance Company S.C.
Tsehay Insurance S.C.
TOTAL
United Insurance CompanyGlobal Insurance CompanyNile Insurance CompanyNyala Insurance CompanyNib Insurance Company
Lucy Insurance S.C.
National Bank of Ethiopia
39Third Quarter 2012/13
2011/12 2012/13 2011/12% ChangeQtr.III Qtr.II Qtr.III
Particulars A B C C/A C/B
Total Capital 3,491,468.0 4,092,187.9 4,289,245 22.8 4.8Saving 4,903,920.0 5,962,351.8 6,913,012 41.0 15.9Credit 7,514,288.0 10,282,277.0 10,770,101 43.3 4.7Total Assets 12,048,730.0 14,719,290.3 16,535,690 37.2 12.3
Table 4.7: Microfinance Institutions Performance as of March 2013 (In Thousands of Birr)
Source; Microfinance Supervision Directorate, NBE
4.5. Activities of the Banking System
4.5.1. Resource Mobilization
Total resources mobilized by the banking
system reached Birr 26.6 billion showing a
4.0 percent growth due to 89.0 percent surge
in net change in borrowing and 18.9 percent
increase in loan collection. (Table 4.8)
National Bank of Ethiopia
40Third Quarter 2012/13
Qtr.III2011/12
Qtr.II2012/13
Qtr.III2012/13
A B C C/A C/B1.Deposits (net change) 11,688.1 10,214.7 3,805.7 5,392.0 17,158.3 15,493.8 15,606.7 -9.0 0.7 -Demand 7,722.0 6,097.3 1,330.8 1,325.1 7,382.3 9,052.8 7,422.4 0.5 -18.0 -Saving 3,017.1 4,077.7 2,612.9 3,518.4 4,817.3 5,630.1 7,596.1 57.7 34.9 -Time 949.0 39.7 -138.1 548.5 4,958.7 810.9 588.2 -88.1 -27.52. Borrowing (net change) -485.9 2,624.7 0.0 0.0 1,389.0 -485.9 2,624.7 89.0 -640.2 -Local -815.3 2,392.6 0.0 0.0 1,407.4 -815.3 2,392.6 70.0 -393.5 -Foreign 329.4 232.1 0.0 0.0 -18.4 329.4 232.1 -1,359.3 -29.53. Collection of Loans 4,931.7 4,163.2 4,640.2 4,239.2 7,068.7 9,571.9 8,402.4 18.9 -12.24. Total Resources Mobilized (1+2+3) 16,133.9 17,002.6 8,445.9 9,631.2 25,616.1 24,579.8 26,633.8 4.0 8.45. Disbursement 7,297.8 12,959.2 6,823.5 4,030.6 14,604.6 14,121.3 16,989.8 16.3 20.36. Change in Liquidity (4-5) 8,836.1 4,043.5 1,622.4 5,600.6 11,011.4 10,458.5 9,644.1 -12.4 -7.8 Memorandum Item:
A. Outstanding Credit* 80,230.7 90,330.7 40,798.8 42,601.1 103,126.2 121,029.5 132,931.8 28.9 9.8 B. Outstanding Interbank Lending 218.8 189.3 0.0 0.0 98.4 218.8 189.3 92.3 -13.5Source: Commercial Banks and staff computation
Table 4.8: Summary of Resource Mobilization & Disbursement of Banking System during Third Quarter of 2012/13
(In Millions of Birr)
Particulars
Public Banks Private Banks Grand Total
% Change
1 2 (3) = (1) + (2)
Qtr.II2012/13
Qtr.III2012/13
Qtr.II2012/13
Qtr.III2012/13
National Bank of Ethiopia
41Third Quarter 2012/13
Source: Staff computation, NBE
4.5.1.1. Deposit Mobilization
Total deposit liabilities of the banking system
reached Birr 222.0 billion at the end of the
third quarter of the fiscal year 2012/13,
indicating annual growth rate of 23.5 percent.
The growth in deposit mobilization was
partly attributed to the rise in the number of
bank branches opened by commercial banks
and improvements in economic activities.
Component wise, demand deposits, which
accounted for 48.3 percent of total deposits,
reached Birr 107.3 billion showing yearly
growth rate of 22.0 percent. Similarly, saving
deposits, with 45.4 percent share in total
deposits increased by 26.5 percent during the
same period. Time deposits, which constituted
6.3 percent of the total deposit liabilities, also
went up by 14.1 percent compared to the same
period last year.
The share of public banks in total deposit
mobilization was 67.8 percent while private
banks took the remaining balance. (Table 4.9)
National Bank of Ethiopia
42Third Quarter 2012/13
(In Millions of Birr)
Quarter III Quarter II Quarter IIIA B C C/A C/B
Demand Deposit 87,905.9 48.9 99,857.3 48.4 107,279.7 48.3 22.0 7.4Saving Deposit 79,612.1 44.3 93,142.0 45.1 100,738.1 45.4 26.5 8.2Time Deposit 12,277.1 6.8 13,415.3 6.5 14,003.5 6.3 14.1 4.4Total 179,795.1 100.0 206,414.6 100.0 222,021.3 100.0 23.5 7.6Share of Public Banks 67.9 67.9 67.8Share of Private Banks 32.1 32.1 32.2
% Change% ShareTypes of Deposits % Share% Share
2011/12 2012/13
Table 4.9: Stock of Deposits Mobilized by Banking System as at the end of March 2013 (Qrt. III 2012/13)
Source: Commercial Banks and DBE
Source: Staff computation, NBE
4.5.1.2. Collection of Loans
During the review period, the banking
system collected Birr 8.4 billion, about
18.9 percent higher than last year (Table
4.8). Of the total loan collection, the share
of private banks was Birr 4.2 billion (50.5
percent) and that of public banks Birr 4.2
billion (49.5 percent) (Table 4.11). Of the
total loan collection 73.0 percent was from
private enterprises followed by state
enterprises (14.2 percent) and cooperatives
(12.4 percent) (Table 4.12).
National Bank of Ethiopia
43Third Quarter 2012/13
4.5.1.3. Borrowing
Total outstanding borrowing of the banking
system was Birr 20.6 billion depicting a
29.3 percent, annual growth due to higher
borrowing both from domestic and
foreign sources. Of the total borrowing,
Birr 18.8 billion (91.4 percent) was from
domestic sources and the remaining Birr
1.8 billion (8.6 percent) from foreign
sources(Table4.10).
2011/12Quarter III Quarter II Quarter III
A B C C/B C/ADomestic Borrowing 14,975.1 16,437.8 18,830.5 14.6 25.7Foreign Borrowing 954.8 1,539.1 1,771.2 15.1 85.5Total 15,929.9 17,977.0 20,601.7 14.6 29.3
Table 4.10: Outstanding Borrowing of the Banking System by Sources as at the End of March 2013
BanksPercentage change
(In Millions of Birr)2012/13
Source: Commercial Banks and Development Bank of Ethiopia
4.5.2. Disbursement of Fresh Loans
During the third quarter of the fiscal year,
total disbursement of fresh loans by the
banking system reached Birr 17.0 billion,
indicating an annual increase of 16.3 percent
(Table 4.8). Of the new loans disbursed, the
share of public banks was Birr 13.0 billion
(76.3 percent) while the remaining balance
was by private banks (Table 4.12).
About 98.0 percent of new loan disbursement
by private banks went to private enterprises
while public banks lent (44 percent) to
private sector with public enterprises taking
up the balance. (Table 4.12)
Sector wise, industry was the largest
beneficiary accounting for Birr 6.7 billion
(39.2 percent) followed by agriculture (27.9
percent), international trade (9.7 percent),
housing and construction (8.0 percent) and
domestic trade (7.3 percent) (Table 4.11).
National Bank of Ethiopia
44Third Quarter 2012/13
Source: Staff computation, NBE
D** C** O/S** D** C** O/S ** D** C** O/S** Central Government * 0.0 0.0 3129.7 0.0 0.0 2376.2 0.0 0.0 5505.9 Agriculture 4,677.2 1,203.1 19178.2 62.6 58.5 596.6 4739.8 1261.6 19774.8 Industry 6,202.6 1,518.5 39773.3 458.6 510.6 5492.1 6661.1 2029.0 45265.5 Domestic Trade 264.4 193.5 2411.3 978.8 1502.8 11945.1 1243.1 1696.3 14356.3 International Trade 415.5 329.2 14699.0 1231.5 1170.1 11588.0 1647.0 1499.3 26287.0 Export 132.6 136.7 5677.4 714.6 436.6 5964.0 847.2 573.4 11641.4 Imports 282.8 192.5 9021.6 584.9 733.4 5668.5 867.7 925.9 14690.1 Hotels and Tourism 102.5 39.9 573.9 139.1 100.9 1998.2 241.6 140.8 2572.1 Transport & Communication 116.8 172.6 2334.9 254.6 262.7 2341.5 371.3 435.4 4676.4 Housing & Construction 730.6 527.7 7870.8 634.8 540.5 6978.3 1365.4 1068.2 14849.1 Mines, Power & Water Res. 0.0 0.0 0.0 70.2 4.7 92.3 70.2 4.7 92.3 Others 446.0 142.7 3156.7 67.0 49.3 1168.4 513.0 192.0 4325.1 Personal 3.6 2.9 143.2 65.5 39.2 356.1 69.2 42.1 499.3 Inter-Bank Lending 0.0 33.1 189.3 0.0 0.0 0.0 0.0 33.1 189.3
Total 12,959.2 4,163.2 93,460.4 4,030.6 4,239.2 44,977.2 16,989.8 8,402.4 138,437.7
(2) (3)
Table 4.11: Summary of Loans and Advances by Banks and Receiving Sectors from July to March 2013 (In Millions of Birr)
** D = Disbursement, C = Collection, O/S= Outstanding Credit
Source: Commercial Banks and staff computation Notes: *Refers to government borrowing in the form of bonds and treasury bills from commercial banks and other sectors other than NBE
Borrowing Sector
Public Banks Private Banks Total(1)
National Bank of Ethiopia
45Third Quarter 2012/13
4.5.3. Outstanding Credit
Total outstanding credit of the banking
system (excluding credit to government)
increased to Birr 132.9 billion at the end of
March 2013, up by 9.8 percent against the
preceding quarter (Table 4.8).
About 94.5 percent of outstanding loan of
private banks was a claim on private
enterprises, (including cooperatives) and
5.3 percent on central government. As for
public banks, 42.7 percent of the
outstanding loan was a claim on
government (including state enterprises)
and 53.7 percent on private enterprises
(Table 4.12).
Sector wise, credit to industry stood first
with Birr 45.3 Billion (32.7 percent)
followed by international trade (19.0
percent), agriculture (14.3 percent),
housing & construction (10.9 percent),
domestic trade (10.4 percent), and other
sectors (12.7 percent) (Table 4.11).
The share of private banks in total
outstanding loan stood at 32.5 percent
while that of public banks was 67.5
percent. (Table 4.12)
(In Millions of Birr)
ParticularsLoan
Disbursement % ShareLoan
Collection % ShareOutstanding
Loan % SharePublic Banks 12,959.2 76.3 4,163.2 49.5 93,460.4 67.5Central Government* 0.0 0.0 0.0 0.0 3,129.7 3.3State Enterprises 5,950.7 45.9 1,185.2 28.5 39,937.1 42.7Cooperatives 4,021.7 31.0 999.0 24.0 15,827.6 16.9Private Enterprises 2,986.7 23.0 1,945.9 46.7 34,376.7 36.8Inter-bank Lending 0.0 0.0 33.1 0.8 189.3 0.2Private Banks 4,030.6 23.7 4,239.2 50.5 44,977.2 32.5Central Government* 0.0 0.0 0.0 0.0 2,376.2 5.3State Enterprises 66.2 1.6 6.4 0.2 93.7 0.2Cooperatives 15.0 0.4 45.7 1.1 496.2 1.1Private Enterprises 3,949.5 98.0 4,187.2 98.8 42,011.2 93.4Inter-bank Lending 0.0 0.0 0.0 0.0 0.0 0.0Grand Total 16,989.8 100.0 8,402.4 100.0 138,437.7 100.0
Table 4.12: Breakdown of Loans & Advances of Banking System by Clients,during Third Quarter of 2012/13
Source: Commercial banks and DBE
Notes: *Refers to government borrowing in the form of bonds and treasury bills from commercial banks and other
sectors other than NBE
National Bank of Ethiopia
Third Quarter 2012/1346
Source: Staff computation, NBE
4.6. Financial Activities of NBE
As at March 31, 2013, total claims of NBE
on the central government reached Birr
50.4 Billion, declining by 9.2 percent vis-à-
vis the same period last year. Of the total
loans and advances on the central
government, direct advance accounted for
99.6 percent and bonds 0.4 percent. Direct
advance surged by 8.6 percent while bonds
dropped by 98 percent as compared to last
year.
Meanwhile, deposits of the central
government and financial institutions at the
NBE stood at Birr 34.9 Billion, up by 15.8
percent against the balance of the same
period last year. Of the total deposits, 51.4
percent was deposit of the central
government which increased by 50.1
percent (Table 4.13). Deposit by financial
institutions, however, went down by 6.7
percent during the same period.
National Bank of Ethiopia
Third Quarter 2012/1347
(In Millions of Birr)2011/12
Qtr.III Qtr.II Qtr.IIIA B C C/A C/B
1.Loans and Advances 67,432.5 59,761.6 65,261.6 -3.2 9.21.1. To Central Government 55,562.5 46,454.6 50,454.6 -9.2 8.6
Direct Advance 46,264.9 46,264.9 50,264.9 8.6 8.6 Bonds 9,297.5 189.7 189.7 -98.0 0.0
1.2.To Development Bank of Ethiopia 11,870.0 13,307.0 14,807.0 24.7 11.32.Deposit Liabilities 30,147.3 37,194.4 34,924.5 15.8 -6.1
2.1. Government 11,962.1 12,778.1 17,952.5 50.1 40.5 2.2. Financial Institutions 18,185.2 24,416.3 16,972.0 -6.7 -30.5
O/W: -Banks 18,177.0 24,394.7 16,948.1 -6.8 -30.5 -Insurance companies 8.1 21.7 23.9 194.4 10.33.Net Claims of NBE 37,285.2 22,567.2 30,337.1 -18.6 34.4
% Change Particulars
2012/13
Table 4.13: Financial Activites of NBE during Third Quarter of 2012/13
Source: NBE
4.7. Developments in Financial Markets
4.7.1. Treasury Bills Market
During the third quarter of the fiscal year
2012/13, the amount of T-bills supplied to
the weekly auction market was Birr 24.1
billion showing a 29.2 percent increase over
the same period last year. The demand for T-
bills also rose by 41 percent to Birr 26.4
billion, up by 41.1 percent (Table 4.14).
Of the total T-bills sold, the share of
commercial banks was 37.9 percent while
that of non bank institutions increased to
62.1 percent.
The stock of T-bills at the end of the quarter
reached Birr 23.7 billion, reflecting a 38.7
percent growth over the same period last
year.
The annual average weighted yield of T-bills
was 1.93 percent; the highest yield being for
short-term (28-day bill) maturity (Table
4.14).
National Bank of Ethiopia
Third Quarter 2012/1348
Table 4.14: - Results of Treasury Bills Auction (In Millions)2011/12
Quarter III Quarter II Quarter IIIA B C C /A C/B
Number of Bidders 116 161 140 20.69 -13.04 Public 49 79 65 32.65 -17.72 Private 67 82 75 11.94 -8.54Number of Bids received 169 157 307 81.66 95.54 Public 59 95 143 142.37 50.53 Private 110 62 164 49.09 164.52Amount Demanded (Mn. Birr) 18,679.58 25,725.36 26,359.14 41.11 2.46 28-day bill 6,964.92 12,218.00 10,833.00 55.54 -11.34 91-day bill 7,594.66 9,173.36 10,366.14 36.49 13.00 182-day bill 2,120.00 2,664.00 2,160.00 1.89 -18.92 364-day bill 2,000.00 1,670.00 3,000.00 50.00 79.64Amount Supplied (Mn. Birr) 18,629.00 29,677.76 24,065.36 29.18 -18.91 28-day bill 6,441.64 15,447.00 8,868.00 37.67 -42.59 91-day bill 7,667.36 8,056.76 9,177.36 19.69 13.91 182-day bill 3,220.00 3,304.00 3,020.00 -6.21 -8.60 364-day bill 1,300.00 2,870.00 3,000.00 130.77 4.53Amount Sold (Mn. Birr) 18,679.58 25,725.36 26,359.14 41.11 2.46 Banks 6,902.52 11,888.00 10,003.00 44.92 -15.86 Non-Banks 11,777.06 13,837.36 16,356.14 38.88 18.20
99.164 99.001 99.155 -0.01 0.16 28-day bill 99.786 99.777 99.779 -0.01 0.00 91-day bill 99.682 99.654 99.650 -0.03 0.00 182-day bill 99.468 99.472 99.469 0.00 0.00 364-day bill 97.721 97.100 97.721 0.000 0.64
1.874 1.534 1.929 2.91 25.76 28-day bill 2.794 2.918 2.883 3.212 -1.19 91-day bill 1.279 1.393 1.410 10.22 1.22 182-day bill 1.074 1.824 1.072 -0.21 -41.26 364-day bill 2.351 0.000 2.351 0.00
17,061.38 21,438.36 23,669.14 38.73 10.41 Banks 890.00 2,461.00 2,993.00 236.29 21.62 Non-Banks 16,171.38 18,977.36 20,676.14 27.86 8.95
Average Weighted Yield for Successful bids (%)
Outstanding bills at the end of Period (Mn.Br.)
Particulars
Average Weighted Price for Successful bids (%)
% Change2012/13
Source: NBE
National Bank of Ethiopia
Third Quarter 2012/1349
Source: staff computation, NBE
Source: staff computation, NBE
0
2500
5000
7500
10000
12500
15000
17500
20000
22500
25000
27500
30000
32500
35000
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III
2003/04 2004/05 2005/06 2006/07 2007/08 2008/9 2009/10 2010/11 2011/12 2012/13
(In m
illio
ns o
f Birr
)Fig IV.13: Developments in T-Bills Market
Demand Supply
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
II III IV I II III IV I II III IV I II III IV I II III Iv I II III IV I II III IV I II III IV I II III IV I II III
2004/05 2005/06 2006/07 2007/08 2008/9 2009/10 2010/11 2011/12 2012/13
(In p
erce
nt)
Fig IV.14: Developments in Average Weighted Yields of T-bills with DifferentMaturities
28-day 91-day 182-day 364-day
National Bank of Ethiopia
Third Quarter 2012/1350
4.7.2. Inter- Bank Money Market
No inter-bank money market transaction
was conducted during the quarter under
review (Table 4.12).
4.7.3. Corporate Bond Market
Corporate bond market is not well developed
in Ethiopia and the big players are few public
institutions and regional governments. The
purchaser of these bonds is the Commercial
Bank of Ethiopia (CBE).
During the quarter under review, CBE
purchased corporate bonds worth Birr 5.1
billion, of which 70.6 percent was issued by
public enterprises and the rest by the Addis
Ababa City Administration.
At the end of March 2013, the stock of
corporate bonds held by CBE stood at Birr
74.4 billion, of which 83 percent was claims
on public enterprises (98.6 percent of which
was issued by EEPCO) and the remaining
balance was on regional states (Table 4.15).
National Bank of Ethiopia
Third Quarter 2012/1351
Table 4.15 Corporate Bond by Holders (Millions of Birr)
Issuer of the Bond
2011/12 2012/13
QIII QII QIII
NP Red O/S NP Red O/S NP Red O/S
1.Puplic Enterprises 6,100.0 0.0 45,770.9 6,900.0 799.8 58,188.7 3,600.0 0.0 61,788.7
EEPCO 6,000.0 0.0 43,900.0 6,700.0 0.0 57,300.0 3,600.0 0.0 60,900.0
ETC 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
DBE 100.0 0.0 1,870.9 0.0 799.8 688.7 0.0 0.0 688.7
SHDE* 0.0 0.0 0.0 200.0 0.0 200.0 0.0 0.0 200.0
2. Regional Governments 1,350.0 449.5 10,222.5 1,676.0 657.8 11,647.8 1,500.0 516.8 12,631.0
Oromia 0.0 0.0 1,993.3 0.0 58.2 1,889.7 0.0 69.3 1,820.4
Amhara 0.0 213.0 1,080.0 0.0 304.5 145.2 0.0 125.3 19.9
Tigray 0.0 34.1 724.1 0.0 13.9 695.0 0.0 37.6 657.4
SNNPRS 0.0 38.3 821.0 0.0 8.3 748.6 0.0 70.4 678.1
Dire Dawa 0.0 4.8 216.0 0.0 2.2 202.9 0.0 1.3 201.6
Harari 0.0 12.8 109.6 0.0 0.0 94.7 0.0 10.0 84.6
Addia Ababa 1,350.0 146.5 5,278.5 1,676.0 270.8 7,871.8 1,500.0 202.8 9,168.9
3.Grand Total(1+2) 7,450.0 449.5 55,993.4 8,576.0 1,457.6 69,836.5 5,100.0 516.8 74,419.7
Note: NP= New Purchase, Red. = Redemption, O/S= outstanding
*Saving Houses Development Enterprise
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