Dashen Bank hires PwC to advise on Ethiopian stock-market listing

By bne IntelliNews September 28, 2023

Dashen Bank has hired ‘Big Four’ accountant PwC to advise on an initial public offering (IPO) on Ethiopia’s planned stock market, CEO Asfaw Alemu tells The Africa Report.

The amount of stock Dashen will sell in the IPO is yet to be determined, as is whether it will list join at the launch of Ethiopian Securities Exchange (ESX), due to take place in 18 months.

According to the US Department of State (DOS), an acute shortage of foreign exchange and Ethiopia’s lack of a capital market hinder private-sector growth and companies’ ability to repatriate profits and secure investment.

Dashen, which has a network of more than 800 branches, nine forex bureaus and 400 ATMs, is looking for ways to improve customer access to foreign currency in Ethiopia. In August, it secured an agreement with British International Investment (BII) and Dutch development bank FMO for a $40m borrowing facility to support agricultural lending.

The agreement has “opened the door” for local banks to seek similar agreements, Alemu told The Africa Report. While the due diligence process was “a tough one”, the fact that Dashen managed to negotiate it should give confidence to other Ethiopian banks, he says.

“We’ve broken that fear,” he is quoted as saying, adding he was sure that discussions with an African bank on a foreign exchange agreement, on which due diligence is close to completion will be successful.

Meanwhile, last month Dashen and Mastercard agreed to launch Ethiopia’s first virtual prepaid card, which can be used for international payments, and recently completed its integration with the local unit of top Kenyan telecom Safaricom’s systems, which will be used to improve mobile banking capacity, Alemu says.

Apart from Dashen, PwC is also advising the Horn of Africa country’s central bank on capacity-building ahead of the launch of the ESX, which has said its target is to start off with some 15 companies with the aim of building up to 50 within a decade.

Addis Ababa is seeking private investors to hold 75% of ESX, with state-owned sovereign wealth fund Ethiopian Investment Holdings owning the rest.

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