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Ethiopian Capital Market Authority Grants Licenses to Five New Market Players

The Ethiopian Capital Market Authority (ECMA) has granted licenses to five new capital market service providers, marking a significant step in the expansion of Ethiopia’s financial markets. The latest additions increase the total number of licensed service providers from four to nine, introducing Ethiopia’s first investment banks and a securities dealer to the market.

The newly licensed firms and their respective categories are:

CBE Capital S.C. – Investment Bank
Wegagen Capital Investment Bank S.C. – Investment Bank
Ethio-Fidelity Securities S.C. – Securities Dealer
HST Investment Advisory Services PLC – Securities Investment Advisor
Equation Securities Investment Advisor PLC – Securities Investment Advisor

This development signifies a milestone in Ethiopia’s capital market evolution, providing a broader range of services, including investment banking, securities dealing, and advisory services. Previously, Ethiopia’s licensed capital market service providers were limited to investment advisory services, and the inclusion of investment banks and a securities dealer is expected to enhance market liquidity and capital-raising opportunities.

Regulatory Support and Industry Growth

The entrance of CBE Capital S.C. and Wegagen Capital Investment Bank S.C. is particularly noteworthy, as both entities are majority-owned by the Commercial Bank of Ethiopia (CBE) and Wegagen Bank, respectively. This expansion aligns with the National Bank of Ethiopia’s directive (SBB/92/2024), which allows banks to fully acquire capital market service providers. The move is expected to foster greater financial sector integration and development.

ECMA Director General emphasized the responsibility placed on the new licensees, urging them to uphold market integrity and contribute to the sustainable growth of Ethiopia’s capital market.

Diversity and Market Inclusivity

Another key highlight is the growing representation of women in Ethiopia’s financial sector. Wegagen Capital Investment Bank S.C. and HST Investment Advisory Services PLC are led by female CEOs, reflecting the increasing role of women in shaping the country’s financial industry.

Future Outlook

The addition of these new market players signals Ethiopia’s commitment to developing a well-regulated and functional capital market. ECMA has reiterated its dedication to fostering an environment that attracts both local and international investors through enhanced regulatory frameworks and market support initiatives.

As Ethiopia continues its financial sector transformation, the growth of capital market service providers is expected to play a crucial role in mobilizing investments and driving economic growth.

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Ethiopian Capital Market Authority Grants Licenses to Five New Market Players

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