KEYIR NEWS:- The National Bank of Ethiopia (NBE) has officially repealed the directive requiring commercial banks to purchase treasury bonds in proportion to their monthly loan disbursements.
The decision was enacted through Treasury Bond Purchase (Repeal) Directive, which came into force on June 23, 2017.
The repealed directive had mandated banks to allocate funds for long-term treasury bonds based on their new loans and advances.
While the requirement is now lifted, the central bank outlined transitional provisions. Any treasury bond purchases allocated for June 2017 under the previous directive must still be fulfilled by July 8, 2017.
Bonds issued prior to the repeal or under transitional arrangements will continue to be governed by the terms of the earlier directive.
The repeal marks a shift in monetary policy that may ease liquidity constraints for commercial banks and influence the allocation of lending resources.