ASSESSMENT OF INTERNATIONAL TRADE PRACTICE ON BANKS PERFORMANCE IN THE CASE OF SELECTED PRIVATE COMMERCIAL BANKS IN ETHIOPIA

Abstract

The prime objective of the study is to investigate the practice of international trade in the performance of the Ethiopian Banking sector. To address the objective, descriptive research design was applied in order to describe the information and answering the research questions related to practice of international trade in the performance in selected private commercial banks. The researcher used both qualitative and quantitative types of data that were collected from primary and secondary sources to achieve the stated objectives of the study. The target population for the study is all international banking managers and trade service officers who are working in Awash International Bank S.C, Dashen Bank, Bank of Abyssinia, Wegagen Bank, United Bank and NIB International Bank. These banks were selected systematically based on amount of profit generated from international trade services, their paid up capital and their experience in their bank service. The finding show that the parallel exchange rate in Ethiopia has effect on Ethiopian international trade; Local rules set by NBE have money defects related with international trade and are the cause for parallel exchange rate increment and so that international trade has a positive effects on the banks performance. The researcher form this finding recommends that parallel exchange rate in Ethiopia has Effect on Ethiopian international trade so that the concerned parties should clearly understand the consequences of the actions made by the NBE. In addition the banks should provide different training session regarding with the topics that the employees wants so that it will help to create a common understanding on international trade.