The central bank has remitted 40.1 million Br in fines it levied on seven banks that failed to invest two percent of their expenses on staff training.

In a letter issued on November 27, 2018, Solomon Desta, director of banking supervision at the National Bank of Ethiopia, notified the banks of the remit, but ordered the banks to use the returned fines in their current fiscal year's budget for staff training.

The National Bank compelled all bank and financial institutions to spend two percent of their expenses, excluding capital expenditures, on human resource development two years ago. While issuing the requirements, the central bank stated that the guideline came into effect with the primary aim of reducing employee poaching in the industry, which had become severe among banks, and to enable the industry to have a capable and competent workforce.

However, last October the central bank issued a letter to the Ethiopian Bankers Association stating that seven banks, including the state policy bank, the Development Bank of Ethiopia, have failed to invest the required amount on staff and board of directors training. The letter also stated that the levied sum, valued at 40.1 million Br, should be used by all of the 18 member banks in the country for staff training.

The letter also requested that the Association report a bank account where the fine will be deposited before October 30, 2018. Additionally, the Association was also asked to craft a training manual for all of its member banks financed by the penalty.

The lion’s share of the levy fell on Dashen, which compelled to pay 11.8 million Br; Abay, 10.9 million Br; Nib, 6.89 million Br; and Berhan Bank, 4.85 million Br.

In addition, Development Bank of Ethiopia was ordered to settle for 4.39 million Br; Bunna, 1.31 million Br; and Cooperative Bank of Oromia paid 420,000 Br in fines for failing to invest in human capital development at their respective banks.

Following the central bank's letter, the Association held a meeting with the seven banks. During the meeting, the representatives of the banks put forward two proposals to resolve the issue. Relieving the banks from the payment or investing the money in their staff in the current fiscal year.