Ethiopia’s capital market gained a new player as Awash Capital S.C., the investment banking arm of Awash Bank, received a licence to operate, marking the fourth investment bank in the country.

The launch positions Awash Bank as the third commercial bank in Ethiopia to create an investment banking subsidiary. Awash Capital is set to begin operations with 200 million birr in initial capital, providing long-term financing, equity investment, and advisory services to sectors including infrastructure, manufacturing, and technology. The firm plans to expand its capital to 400 million birr in the near future.

The Ethiopian Capital Market Authority (ECMA), which approved the licence along with the appointment of five board directors and four representatives, described the development as a sign of growing confidence in the country’s financial markets. ECMA said it reflects the authority’s ongoing efforts to maintain a competitive and transparent capital market.

Ethiopia’s capital market remains nascent, with thirteen licensed Capital Market Service Providers, including four investment banks. Analysts say the entry of new investment banks is likely to enhance competition and broaden financing options for businesses, but they caution that smaller, inadequately supervised entrants could distort prices or mismanage capital.